2025-002 – Activities Allowed or Unallowed and Allowable Costs/Cost Principles – Material Weakness in Internal Controls over Compliance and Instance of Noncompliance Department of Education Federal Assistance Listing Number: 84.031 Federal Program Name: Higher Education Institutional Aid Federal Award Number: P031S210057, P031C210038 Award Year: 2024-25, 2023-24, 2022-23, 2021-22 Criteria – Compensation costs are allowable to the extent they satisfy requirements of 2 CFR section 200.430, and the total compensation for individual employees is determined and supported as provided in 2 CFR section 200.430(g), including that charges to Federal awards for salaries and wages be based on records that accurately reflect the work performed. Condition/context – A sample of 14 employees out of a population of 28 employees whose compensation was charged to the awards was selected. Of the 14 employees selected, we found errors with 7 employees, across a sample of 11 separate payroll transactions, which consisted of the following: • For 6 employees across one or more payroll transactions selected, no records were available to support the actual allocation of time that was charged to each award or the amount allocated to the award did not agree to the time and effort reporting. • In one instance, an employee’s time was charged to the grant at a pay rate that was less than the approved pay rate in effect. The grant was undercharged. • In one instance, no records were available to support an employee stipend charged to the grant. The personnel action form that is completed upon hire indicated the allocation of time worked in some instances, however, in accordance with 2 CFR section 200.430 (g)(1)(viii) estimates determined before the services are performed do not qualify as support for charges to Federal awards. Our sample was not, and was not intended to be, statistically valid. Questioned costs – Costs are charged based on budgeted amounts and support for actual time is not maintained consistently as such questioned costs are not identified. Known questioned cost for stipend charged to the grant was $113. Cause/effect – The University does not have the proper controls in place to ensure time and effort reporting is completed or completed accurately. The lack of records supporting the actual allocation of time charged increases the risk of unallowable compensation costs being charged to the federal award. Repeat finding – Yes, 2024-002 Recommendation – We recommend the University implement an internal control policy that satisfies the requirements outlined in 2 CFR section 200.430(g). Views of responsible officials and planned corrective actions – Heritage University agrees with the recommendation and is strengthening its internal controls over personnel expenses charged to federal awards and sponsored projects.
2025-007 – Activities Allowed or Unallowed and Allowable Costs/Cost Principles – Material Weakness in Internal Controls over Compliance and Instance of Noncompliance Department of Education Federal Assistance Listing Number: 84.184 Federal Program Name: Mental Health Service Professional Demonstration Grant Program Federal Award Number: S184X230057 Award Year: 2024-25, 2023-24 Criteria – Compensation costs are allowable to the extent they satisfy requirements of 2 CFR section 200.430, and the total compensation for individual employees is determined and supported as provided in 2 CFR section 200.430(g), including charges to Federal awards for salaries and wages be based on records that accurately reflect the work performed. Condition/context – A sample of 9 employees out of a population of 17 employees whose compensation was charged to the awards was selected. Of the 9 employees selected we found errors with 8 employees, across a sample of 18 separate payroll transactions, which consisted of the following: • For 3 employees across one or more payroll transactions selected, no records were available to support the actual allocation of time that was charged to each award or the amount allocated to the award did not agree to the time and effort reporting. • For 3 employees across one or more payroll transactions selected, the time and effort reports were not completed and reviewed in a timely manner. • For 4 employees across one or more payroll transactions selected, the time and effort reports were missing key elements including employee signatures and indication of timely review by an individual knowledgeable of grant activities The personnel action form that is completed upon hire indicated the allocation of time worked in some instances, however, in accordance with 2 CFR section 200.430 (g)(1)(viii) estimates determined before the services are performed do not qualify as support for charges to Federal awards. Our sample was not, and was not intended to be, statistically valid. Questioned costs – Undeterminable as records to support allocation were not complete or accurate. Cause/effect – The University does not have the proper controls in place to ensure time and effort reporting is completed or completed accurately. The lack of records supporting the actual allocation of time charged increases the risk of unallowable compensation costs being charged to the federal award. Repeat finding – Yes, 2024-008 Recommendation – We recommend the University implement an internal control policy that satisfies the requirements outlined in 2 CFR section 200.430(g). Views of responsible officials and planned corrective actions – Heritage University agrees with the recommendation and is strengthening its internal controls over personnel expenses charged to federal awards and sponsored projects.
2025-008 – Activities Allowed or Unallowed and Allowable Costs/Cost Principles – Material Weakness in Internal Controls over Compliance and Instance of Noncompliance National Science Foundation Federal Assistance Listing Number: Various Federal Program Name: Research and Development Cluster Federal Award Number: Various Award Year: 2024-25, 2023-24 Criteria – Compensation costs are allowable to the extent they satisfy requirements of 2 CFR section 200.430, and the total compensation for individual employees is determined and supported as provided in 2 CFR section 200.430(g), including charges to Federal awards for salaries and wages be based on records that accurately reflect the work performed. Condition/context – A sample of 6 employees out of a population of 15 employees whose compensation was charged to the awards was selected. Of the 6 employees selected we found errors with 5 employees, across a sample of 12 separate payroll transactions, which consisted of the following: • For 2 employees across one or more payroll transactions selected, no records were available to support the actual allocation of time that was charged to each award or the amount allocated to the award did not agree to the time and effort reporting. • For 3 employees across one or more payroll transactions selected, the time and effort reports were missing key elements including employee signatures and indication of timely review by an individual knowledgeable of grant activities. Our sample was not, and was not intended to be, statistically valid. Questioned costs – Undeterminable as records to support allocation were not complete or accurate. Cause/effect – The University does not have the proper controls in place to ensure time and effort reporting is completed or completed accurately. The lack of records supporting the actual allocation of time charged increases the risk of unallowable compensation costs being charged to the federal award. Repeat finding – Yes, 2024-009 Recommendation – We recommend the University implement an internal control policy that satisfies the requirements outlined in 2 CFR section 200.430(g). Views of responsible officials and planned corrective actions – Heritage University agrees with the recommendation and is strengthening its internal controls over personnel expenses charged to federal awards and sponsored projects.
2025-004- Activities Allowed or Unallowed; Allowable Costs/Cost Principles. Federal Agency: U.S. Department of Labor Federal Program Title: WIOA Cluster (WIOA Adult Program; WIOA Youth Activities; WIOA Dislocated Worker Formula Grants) ALN: 17.258, 17.259, 17.278 Award Identification Number: 23A55AY000015; AA-38542-22-55-A-32; AA-36332-21-55-A-32, 23A55AT000046; 23A55AW000038; 23A55AY000015 Pass-Through Agency: State of Nevada, Department of Employment, Training and Rehabilitation (DETR) Pass-Through Award Number and Period: PY23-A-01-WIOA; PY24-A-01-WIOA; PY23-Y-01-WIOA; PY24-Y-01-WIOA; PY23-DY-01-GR; PY23-DW-01-WIOA; PY24-DW-01- WIOA (All for the period 4/1/2023 – 6/30/2026) Type of Finding: Material Weakness in Internal Control over Compliance and Material Noncompliance Criteria or specific requirement: 2 CFR 200.430(i), Standards for Documentation of Personnel Expenses, requires that charges to federal awards for salaries and wages be based on records that accurately reflect the work performed, be supported by a system of internal control that provides reasonable assurance the charges are accurate, allowable, and properly allocated, and be incorporated into official records. 2 CFR 200.430(a) requires compensation to be reasonable and allocable, 2 CFR 200.403 requires costs to be adequately documented, and 2 CFR 200.303 requires effective internal \ control over federal awards. (WIOA Cluster — Activities Allowed / Allowable Costs, 2025 Compliance Supplement Part 4, ALNs 17.258/17.259/17.278.) Condition: As part of testing compliance with Activities Allowed or Unallowed and Allowable Costs/Cost Principles, audit procedures included reviewing payroll transactions charged to the WIOA Cluster and evaluating controls over payroll approval and labor cost allocation. Testing of payroll authorization identified that two of twenty-five employee timecards selected for testing lacked evidence of supervisory review and approval. In both instances, the timecards were approved only by the employee and no evidence of managerial review was maintained. Testing of payroll allocations further identified significant deficiencies in Nevadaworks’ labor distribution process. For eleven of twelve employees selected for detailed testing, management was unable to provide supporting documentation demonstrating how payroll costs were allocated among individual federal programs. Although payroll charges were recorded to specific grants in the accounting records, the amounts charged could not be reconciled to personnel activity records, allocation methodologies, or other supporting documentation sufficient to demonstrate that costs were properly assigned to benefiting programs. The condition was not isolated to a single employee or program and was determined to represent a breakdown in the Entity's payroll allocation and review processes affecting the WIOA Cluster as a whole. Questioned costs: $84,685 known; additional related questioned costs unknown. Context: Payroll represents pprox.. 16% of the total program expenditures and our sample represents pprox.. 10% of the payroll costs. Cause: Internal controls over payroll approval and labor distribution did not operate effectively during the fiscal year. Significant turnover within the finance and administrative functions contributed to the breakdown in established procedures. In addition, management had not implemented a formal process requiring periodic reconciliation of payroll allocations to supporting personnel activity information or documented supervisory review of allocation calculations. Effect: Nevadaworks was unable to demonstrate that payroll costs charged to the WIOA Cluster were properly authorized, supported, and allocated to benefiting federal programs. As a result, compliance with federal requirements governing allowable costs could not be verified. The lack of adequate supporting documentation resulted in known questioned costs exceeding the threshold for reporting and constitutes material noncompliance with federal program requirements. Repeat Finding: No. Recommendation: Management should implement formal payroll allocation procedures that clearly document the methodology used to allocate employee compensation among federal awards. Payroll allocations should be supported by contemporaneous records that accurately reflect work performed and should be reviewed periodically for reasonableness. In addition, all employee time records should be subject to documented supervisory review and approval prior to payroll processing. Views of responsible officials: There is no disagreement with the audit finding. Nevadaworks will strengthen payroll authorization and labor allocation procedures by requiring approved time records, documented grant allocations, supervisory review of payroll records, monthly reconciliation of payroll charges, and periodic reviews of allocation methodologies for compliance with federal requirements.
Federal Agency: U.S. Department of Education Federal Program Name: Title I Assistance Listing Number: 84.010 Federal Award Identification Number and Year: Unknown Pass-Through Agency: RI Department of Education Pass-Through Number(s): 2725-11702-501 Award Period: July 1, 2024 – September 30, 2026 Type of Finding: • Significant Deficiency in Internal Control over Compliance • Other Matters Criteria or specific requirement: Under the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (2 CFR Part 200), specifically 2 CFR §200.430(i), 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 controls which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Additionally, the non-Federal entity is required to have written procedures and a system of internal controls to ensure that charges for compensation are accurate, allowable, and properly allocated to each applicable cost objective. Condition: The school department did not maintain adequate time and effort documentation to support payroll costs charged to the program. Questioned costs: None Context: During testing of payroll expenditures, it was identified that the school department was not able to provide the time and effort documentation required for all tested payroll expenditures. Cause: School department procedures for monitoring and retaining time and effort documentation were not consistently implemented. In addition, management oversight procedures did not ensure that required certifications were completed timely, reviewed for accuracy, and retained in accordance with federal requirements. Effect: This condition increases the risk that federal funds may have been charged for costs not properly supported or not benefiting the program, resulting in noncompliance with federal grant requirements. Recommendation: Establish and formally document procedures to ensure time and effort documentation is completed in accordance with federal requirements. Require periodic review of procedures by management to verify accuracy and completeness. Ensure all time and effort documentation is properly retained and readily available for audit purposes. Provide training to applicable staff on federal time and effort documentation requirements. Views of responsible officials: There is no disagreement with the audit finding.
Finding Number: 2025-001 Maintain Documentation Supporting Employee Pay Rates Federal Agency: U.S. Department of Education Pass-through Entity: Massachusetts Department of Elementary and Secondary Education Award Name: Title I Grants to Local Educational Agencies Assistance Listing Number: 84.010 Compliance Requirement: A/B – Activities Allowed or Unallowed, Allocable Costs/Cost Principles Type of Finding Compliance Internal Control over Compliance – Significant Deficiency Criteria: Under 2 CFR §200.430, charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed and be supported by appropriate documentation. Additionally, entities are required to maintain effective internal controls over Federal awards in accordance with 2 CFR §200.303 to provide reasonable assurance that transactions are properly authorized, supported, and in compliance with Federal requirements. Condition and Context: During testing of payroll expenditures charged to the Title I program, the City was unable to provide one signed Memorandum of Understanding (MOU) or other equivalent documentation supporting the hourly pay rate charged to the program. We were able to review an approved timesheet and further verify the costs were consistent with others charged to the program and allowable. For this one transaction, the City was unable to demonstrate that the compensation amount charged to the grant was properly authorized under a signed MOU. Cause: The City's controls did not ensure the supporting documentation used to establish this one employee’s compensation rate was maintained. Effect or Potential Effect: Without adequate supporting documentation for compensation rates, the City may not be able to demonstrate that payroll costs charged to the Title I program were properly authorized. This increases the risk that potentially unsupported payroll expenditures could be charged to the Federal award. Questioned Costs: None reported. We determined that the amount charged was allowable. Recommendation: The City should strengthen its internal controls over payroll by ensuring that documentation supporting all employee compensation rates are maintained and retained in accordance with Federal record retention requirements. Management should ensure part of the procedures are to periodically review personnel files to verify that compensation documentation is complete and readily available to support payroll charges to Federal awards.
State Agency: Illinois Department of Children and Family Services (DCFS) Federal Agency: U.S. Department of Health and Human Services (USDHHS) Program Name: Temporary Assistance for Needy Families Foster Care – Title IV-E Adoption Assistance ALN and Program Expenditures: 93.558 ($593,881,225), 93.658 ($190,740,988), 93.659 ($114,759,333) Award Numbers: Various – see table of award numbers Federal Award Year: Various – see table of award numbers Questioned Costs: Cannot be determined Compliance Requirement: Activities Allowed/Unallowed Allowable Costs/Costs Principles Finding 2025-024: Failure to Provide Supporting Documentation for Payroll and Related Costs Condition Found: DCFS could not provide adequate supporting documentation to substantiate payroll and related costs claimed for federal reimbursement under the Foster Care – Title IV-E (Foster Care), Adoption Assistance, and Temporary Assistance for Needy Families (TANF) programs. On a weekly basis, DCFS employees complete and sign timesheets to report and certify their time. These timesheets are then reviewed and approved by the employee’s immediate supervisor. The supervisor approves the timesheets based on their knowledge of the employee’s hours worked during the pay period. Timesheets are scanned for archiving once a month by the payroll department. Timesheets are manually entered into the time reporting system (Employee Monthly Time Report) which is used to accumulate the costs related to each cost center. Cost pool data from the time reporting system is used to identify personal service expenditures attributable to DCFS’s State and federal programs and to calculate and allocate the related fringe benefit charges and indirect costs. During our testing of 40 direct payroll expenditures charged to the cost pools allocated to the Foster Care, Adoption Assistance, and TANF programs (totaling $159,725) during the year ended June 30, 2025, we noted the following: "See full report for chart/table." The timesheet for one employee (supporting cost pool payroll expenditures sampled of $3,338) could not be provided for testing. DCFS personnel stated they were unable to locate the timesheet for this employee for the sampled period. Upon further review, DCFS personnel noted timesheets were unable to be located for this employee and all employees within the same pay group (totaling 16 additional employees) for the entire fiscal year, resulting in approximately 403 missing timesheets (related to payroll, fringe benefits, and indirect costs included in the cost pool totaling $1,636,270, $1,389,016, and $726,519, respectively). As a result, the personal service (payroll and fringe benefit) expenditures, as well as related indirect costs, were not appropriately supported in accordance with the requirements of the applicable cost principles. Accordingly, the personal service expenditures and indirect costs were not allowable. The hours reported for one employee (with sampled personal services expenditures from the cost pool of $5,074) in the timekeeping system used to allocate personal services expenditures to Foster Care, Adoption Assistance, TANF, and other programs operated by the agency exceeded the hours reported on manual timesheets prepared by the employees and approved by supervisors. There were 2.5 unsupported hours reported in the timekeeping system resulting in unsupported personal service expenditures from the cost pool of $11. Additionally, we noted the controls to ensure required documentation is obtained to support payroll and related costs and maintained to evidence management approval of payroll information were not operating effectively. We also noted adequate internal controls have not been established to ensure the data included in the timekeeping system and used to allocate personal services expenditures to Foster Care, Adoption Assistance, TANF, and other programs operated by DCFS is consistent with the hours reported on manual timesheets prepared by the employees and approved by supervisor. Personal service (payroll and fringe benefit) expenditures and related indirect costs charged to the Foster Care, Adoption Assistance, and TANF programs for the year ended June 30, 2025, were as follows: "See full report for chart/table." Criteria or Requirement: 2 CFR 200.403 establishes principles and standards for determining costs for federal awards carried out through grants, cost reimbursement contracts, and other agreements with state and local governments. To be allowable under federal awards, costs must meet certain general criteria. Those criteria require, among other things, that the expenditure be adequately documented. According to 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, among other things, supported by a system of internal control, comply with the established accounting policies and practices of the non-Federal entity, and support the distribution of the employee’s salary or wages amount across specific activities or cost objectives if the employee works on more than one 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. In addition, 2 CFR 200.303 requires nonfederal entities to, among other things, 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. Effective internal controls should include procedures to ensure required documentation is obtained to support payroll and related costs and to maintain documentation evidencing management approval of payroll information. Cause: In discussing these conditions with DCFS officials, they stated these exceptions were due to human error and the limitations of keeping a complete file record for the paper-based overtime approval and timesheet process. Furthermore, management indicated that prior year correction action plans have not fully resolved this issue because the anticipated transition date of the payroll and timekeeping system has been delayed. Possible Asserted Effect: Failure to accurately document and maintain required timesheets results in noncompliance with federal regulations and unallowable costs. Repeat Finding: A similar finding was reported in the prior year audit as finding number 2024-023. (Finding code 2025-024, 2024-023) Statistical Sampling: The sample was not intended to be, and was not, a statistically valid sample. Recommendation: We recommend DCFS review its current procedures and consider any changes necessary to ensure supporting documentation for payroll and related costs is maintained and accurately reflects work performed in accordance with the applicable federal regulations. Views of DCFS Officials: DCFS has improved communication with and the training of its timekeepers in order to ensure accurate and consistent timekeeping standards. DCFS has also instituted new quality control procedures to identify and correct errors. All timekeepers are required to submit timesheets for digital archive to ensure proper record retention. DCFS is also actively pursuing modernization efforts for both payroll and timekeeping, using timekeeping and payroll systems available from the Illinois Department of Central Management Services.
State Agency: Illinois Board of Higher Education (IBHE) Federal Agency: U.S. Department of Health and Human Services (USDHHS) Program Name: Child Care and Development Fund (CCDF) Cluster ALN and Program Expenditures: 93.575/93.596 ($424,695,722) Award Numbers: Various – see table of award numbers Federal Award Year: Various – see table of award numbers Questioned Costs: None Compliance Requirement: Subrecipient Monitoring Finding 2025-028 Inadequate Process to Communicate Award Information to Subrecipients Condition Found: IBHE does not have an adequate process in place to ensure required award information is accurately communicated to subrecipients of the Child Care Development Fund (CCDF) Cluster (CCDF Cluster) program. IBHE is responsible for coordinating program funding of certain subrecipients of the CCDF Cluster program. While IBHE uses a standard contract document for its agreements with subrecipients, the specific award information is manually input into each contract by program contracting personnel. During our testing of CCDF Cluster program subrecipient contracts under which federal funds were expended during the year ended June 30, 2025, we noted IBHE did not accurately communicate all required information to its subrecipients. Specifically, we noted the award communication included incorrect details as follows: "See full report for chart/table." Criteria or Requirement: 2 CFR 200.403 establishes principles and standards for determining costs for federal awards carried out through grants, cost reimbursement contracts, and other agreements with state and local governments. To be allowable under federal awards, costs must meet certain general criteria. Those criteria require, among other things, that the expenditure be adequately documented. According to 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, among other things, supported by a system of internal control, comply with the established accounting policies and practices of the non-Federal entity, and support the distribution of the employee’s salary or wages amount across specific activities or cost objectives if the employee works on more than one 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. In addition, 2 CFR 200.303 requires nonfederal entities to, among other things, 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. Effective internal controls should include procedures to ensure required documentation is obtained to support payroll and related costs and to maintain documentation evidencing management approval of payroll information. Cause: In discussing these conditions with DCFS officials, they stated these exceptions were due to human error and the limitations of keeping a complete file record for the paper-based overtime approval and timesheet process. Furthermore, management indicated that prior year correction action plans have not fully resolved this issue because the anticipated transition date of the payroll and timekeeping system has been delayed. Possible Asserted Effect: Failure to accurately document and maintain required timesheets results in noncompliance with federal regulations and unallowable costs. Repeat Finding: A similar finding was reported in the prior year audit as finding number 2024-023. (Finding code 2025-024, 2024-023) Statistical Sampling: The sample was not intended to be, and was not, a statistically valid sample. Recommendation: We recommend DCFS review its current procedures and consider any changes necessary to ensure supporting documentation for payroll and related costs is maintained and accurately reflects work performed in accordance with the applicable federal regulations. Views of DCFS Officials: DCFS has improved communication with and the training of its timekeepers in order to ensure accurate and consistent timekeeping standards. DCFS has also instituted new quality control procedures to identify and correct errors. All timekeepers are required to submit timesheets for digital archive to ensure proper record retention. DCFS is also actively pursuing modernization efforts for both payroll and timekeeping, using timekeeping and payroll systems available from the Illinois Department of Central Management Services.
Federal programs Research and Development Cluster – National Institutes of Health – Drug Abuse and Addiction Research Programs AL #: 93.279 Award Year: 2024/2025 Type of finding Significant Deficiency and Noncompliance Compliance requirement Activities Allowed or Unallowed and Allowable Costs/Cost Principles Criteria Under 2 CFR section 200.430(i), costs of compensation for personal services are allowable to the extent the total compensation for individual employees is reasonable for the services rendered and conforms to the established written policies and practices, follows an appointment made in accordance with non-federal entities rules and written policies, and is determined and supported as provided in 2 CFR section 200.430(i), including that charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed. Condition We noted one out of forty judgmentally selected payroll transactions included cost for an employee that did not relate to services performed in relation to the grant. Questioned costs $625 Context A portion of an employee’s benefits was improperly charged to the grant. Cause When the University changed their timekeeping platform an academic affairs employees’ compensation was improperly set up in the system which incorrectly allocated their vacation time to this grant. Effect The employee’s vacation time that occurred after the change in the University’s timekeeping platform in March 2025 until the discovery after year end was incorrectly included as compensation and benefits expense within the grant. Repeat finding No Recommendations We recommend that the University ensure controls are in place to adequately review all benefits pay charged to grants to ensure appropriate. View of responsible officials To safeguard from future errors and ensure data accuracy, Human Resources partnered with Enterprise Application Services department to develop an automated process that populates earnings codes and project account codes based on employee, job record and earnings code. This enhancement streamlines data entry by consolidating it into a single interface, reducing the risk of manual entry errors. Additionally, the HR Technology Manager has implemented a new monitoring report to track employees with multiple salary distribution accounts as a part of payroll process. The biweekly report will be automatically generated and sent via email to HR’s HRIS Consultants for review. The HRIS Consultants will analyze the report, resolve any discrepancies and escalate any issues to the HR Technology Manager or Lead Application Consultant as necessary. These processes will be routinely reviewed, with adjustments made as needed.
Item 2025-005 - Activities Allowed and Unallowed Costs - U.S. Department of Health and Human Services, Health Center Program Cluster (Assistance Listing Number 93.224/93.527) Notice of Award Number 6 H80CS00505-23-04, 6 H2ECS45602-02-04, 1 H8LCS50772-01-00 and 6 H8HCS46163-03-01 - (Material Weakness) Criteria: Per 2 CFR §200.430(i) - Standards for Documentation of Personnel Expenses, 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, reflect actual time worked on specific federal programs and be incorporated into the official records of the non-federal entity. Statement of Condition: During our audit, we noted that LBUCC charged salaries to the Section 330 grant based on pre-determined allocations or budget rather than actual hours worked. LBUCC utilized timesheets that reflect the allocations as its time and effort documentation. Cause: LBUCC has not implemented a time and effort reporting system that captures actual hours worked on federal programs. Effect: Failure to maintain and monitor time and effort based on actual hours worked may lead to disallowed costs. Questioned Costs: None. Although salaries charged were based on allocations or budget, we determined that only one employee was charged to two grant-funded programs during one pay period. All other employees’ salaries were charged to one grant-funded program for each pay period during the year. For the employee whose salary was charged to more than one grant-funded program, we verified that the total of the employee’s salaries charged to each grant-funded program did not exceed 100% of her total salaries for the pay period. Context: LBUCC’s management meets monthly to discuss if the budgeted or allocated salaries per program for the month was reflective of actual hours worked. During this discussion, management ascertains if there is a need to adjust the budgeted or allocated salaries. However, this discussion and the approval of the final budget or salaries is not documented. Identification as a Repeat Finding: This is not a repeat finding. Recommendation: We recommend that LBUCC implement a time and effort reporting system that tracks actual hours worked on each program or grant. We recommend that they require supervisors to review and approve the actual time spent on grant activities and that such review and approval be documented. Management Response: Management agrees with the finding and will implement these steps to ensure compliance with the federal cost principles, strengthen internal controls, and reduce the risk of questioned costs.
2025-001: U.S. Department of Health and Human Services, National Institutes for Health Research and Development Cluster, Cancer Control, Assistance Listing #93.399; Lack of Required Written Policies Condition Montana Cancer Consortium (the Consortium) does not have written policies and procedures in place as required by 2 CFR § 200.302 and § 200.313. Specifically, the Consortium lacks documented policies for: • The timing of federal cash draws; • The allowability of costs charged to federal awards; and • Documentation of time-and-effort for personal services. Criteria 2 CFR § 200.302(b)(6)–(7) requires nonfederal entities to have written procedures for: (a) cash drawdowns and (b) determining cost allowability. § 200.305 requires written cash-management procedures that minimize the time between draw and disbursement. § 200.430 requires a written policy that is consistently applied to both federal and nonfederal activities for documentation of compensation for personal services. Context At the time of completion of the audit for the year ended May 31, 2025, the written policies were not in place. We noted that the policies were implemented on December 1, 2025, which was after the fiscal year under audit had ended. Cause The Consortium has not yet developed or adopted the required written policies due to limited administrative capacity and reliance on informal practices. Effect The absence of written policies increases the risk of noncompliance with federal requirements, mismanagement of federal funds, and audit findings in future periods. It may also impair the Consortium’s ability to consistently apply federal cost principles and properly safeguard assets. Recommendation We recommend that the Consortium develop and implement written policies and procedures that comply with the requirements of Uniform Guidance. Management Response See Corrective Action Plan.
Finding 2025-008 – Allowable Costs/Cost Principles and Matching, Level of Effort, and Earmarking Information on the federal program: Federal awarding agency: United States Department of Education (ED) Federal program: School Safely National Activities, Assistance Listing No. 84.184X Award year: 2024‐2025 Criteria or specific requirement (including statutory, regulatory or other citation): 2 CFR 200.303 requires that a non-federal entity must (a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 2 CFR 200.430 (i) states “Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflected 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 federal assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity’s written policy; (v) comply with the established accounting policies and practices of the non-Federal entity.” Condition: The University did not have effective internal controls over the timely preparation and approval of employees’ time and effort certifications. Cause: The University did not execute their internal controls for the timely preparation and approval of employees’ time and effort certifications on a timely basis. Effect or potential effect: Unallowable and/or inaccurate payroll expenditures could be charged to the federal program due to the delay in the preparation and approval of the time and effort certifications. Level of effort per grant award notification and grant proposal documents may not be met as required for the applicable employees with level of effort requirements, the program director/principal investigator and co-investigators, for the School Safely National Activities Program. Questioned costs: None. Context: It is the University’s policy to have time and effort certifications prepared and approved for grant employees on a semesterly basis. For 9 of 14 payroll expenditures selected for testing, the University’s employees prepared their time and effort certifications between 4 and 10 months after the applicable semester ended, with approvals made after that time. The grant documents provide for level of effort requirements for the program for five employees, including the program director/principal investigator with a level of effort of 25% and 4 co-investigators with level of effort of 2.5%. The University’s total School Safely National Activities program expenditures were $1,310,305 for the year ended May 31, 2025. Of this amount, $209,270 related to payroll expenditures, including fringe benefits. Identification of a repeat finding: Not applicable. Recommendation: We recommend the University execute its internal controls to provide for the preparation and approval of employees’ time and effort certifications on a timely basis after the end of each semester. Views of responsible officials: Management agrees with the finding and has developed a corrective action plan in which the University updated the time and effort reporting form and the Grants Accounting Office will ensure the forms are completed timely. The corrective action was implemented by February 6, 2026.
. Finding 2025-004 (Material Weakness) Program: Coronavirus State and Local Fiscal Recovery Funds Federal Agency: United States Department of Treasury AL #: 21.027 Federal Award Identification Number and Year: Various – See SEFA Pass-through Entity: N/A Type of Compliance Finding: A) Activities Allowed or Unallowed and B) Allowable Costs/Cost Principles Criteria Recipients may use SLFRF payments for any eligible expenses subject to the restrictions set forth in sections 602 / 603 of the Social Security Act as added by section 9901 of the American Rescue Plan Act of 2021, codified at 42 USC sections 802 and 803, and as amended by the 2023 CAA. Per 2 CFR 200.430(g)(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 that provides reasonable assurance that the charges are accurate, allowable, and properly allocated 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. Condition Management did not provide sufficient evidence to support the charges for salaries and wages for five of the seven employee samples who work solely on one cost objective or multiple cost objectives. Cause Management does not have controls and processes in place to ensure that required documentation is maintained to support federal award charges for salaries and wages. Effect Unallowable salary expenses were charged to the federal award, which could result in the City not receiving federal assistance or repayment of grant funds. Questioned Costs $11,480 Context The total salaries and wages were $1,036,364 and likely questioned costs are $252,797. Is the finding a repeat finding No Recommendations We recommend management establish a process to ensure required documentation is maintained to support federal award salaries and wages. Views of Responsible Officials/ Planned Corrective Actions Management agrees with the finding. See Corrective Action Plan on Organization’s letterhead.
2025-002 - Lack of Written Federal Program Policies. Type: Material Weakness. Condition: The Village does not have documented policies and procedures specific to the administration of the Coronavirus State and Local Fiscal Recovery Funds program. This includes the absence of written guidance on key compliance areas such as payments, procurement, allowability of costs charged to federal programs, compensation, and travel costs under Uniform Guidance. Criteria: Per 2 CFR 200.303 and 200.331 of the Uniform Guidance, non-federal entities are required to establish and maintain effective internal controls and written policies to ensure compliance with federal statutes, regulations, and the terms and conditions of federal awards. These policies should be tailored to the specific requirements of each federal program. Cause: The entity has not developed formal written policies and procedures for the Coronavirus State and Local Fiscal Recovery Funds program, possibly due to reliance on informal practices or general administrative policies that do not address federal-specific requirements. Effect: Without documented policies, there is an increased risk of noncompliance with federal requirements, inconsistent program administration, and lack of accountability. This may result in questioned costs, audit findings, or potential repayment of federal funds. Recommendation: We recommend that the Village develop and implement written policies and procedures specific to the Coronavirus State and Local Fiscal Recovery Funds program. These should include: - Payments in accordance with §200.302 (6), - Procurement in accordance with §200.318, - Allowability of costs charged to federal programs in accordance with §200.302 (7), - Compensation in accordance with §200.430 and §200.431, - Travel costs in accordance with §200.474. Training should also be provided to staff responsible for administering the program to ensure consistent application of these policies. Views of Responsible Officials: Management acknowledges the auditor’s finding regarding the absence of formally documented federal program policies. We recognize the importance of maintaining written procedures to ensure consistent compliance with Uniform Guidance requirements and to strengthen internal controls over federal awards. While informal practices have historically guided our federal program administration, we agree that formalizing these policies will enhance transparency, accountability, and operational efficiency. Management is currently in the process of developing written policies covering key areas such as procurement, allowable costs, subrecipient monitoring, and cash management. We anticipate completing this documentation and implementing the policies by February 28, 2026. We are committed to continuous improvement and appreciate the auditor’s recommendations as part of our efforts to maintain strong compliance and stewardship of federal funds.
2 CFR §2400.101 gives regulatory effect to the Department of Housing and Urban Development for 2 CFR §200.303(a) which states that the 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 be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Furthermore, 2 CFR §200.430(i)(1)(i) states "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 controls which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. The “City of Columbus Fiscal Policies and Procedures for the Administration of HUD Grants Manual” Part II Section C – Standards for Documentation of Personal Services provides the following: All grant funded staff (both city staff and subrecipient staff) will utilize personal activity reports (timesheets). All timesheets will reflect total hours worked, identify the federal grant hours worked, and be signed by either the employee or the supervisor. Furthermore, the City of Columbus Department of Development has established a procedure of timesheet review which requires supervisors review employee timesheets within one week of the pay period end date. This review is evidenced by an electronic signature on the employee-completed timesheet.While the City does have an internal control policy in place in accordance with 2 CFR 430(i)(1)(i), supervisors were not always adhering to the policy which resulted in a deficiency in the application of the control process. During payroll control testing over AL #14.239 Home Investment Partnership Program, it was noted 3 out of the 5 selected worklogs (60%) were not signed by the supervisor within the one-week requirement as required by City policy. Supervisory sign offs occurred between 12 and 32 working days (not including weekends) following the end of the pay period.Failure to follow the established internal control policy and ensuring all time sheets are appropriately approved by a knowledgeable supervisor, within one week of the pay period end date, could result in unallowable costs being allocated to a federal program and could ultimately result in noncompliance and/or a questioned cost. The City should review established policies and procedures with supervisory personnel and evaluate if additional control procedures should be in place to ensure all timesheets are appropriately reviewed timely prior to allocation to a federal program.
2 CFR §2400.101 gives regulatory effect to the Department of Housing and Urban Development for 2 CFR §200.303(a) which states that the 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 be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Furthermore, 2 CFR §200.430(i)(1)(i) states "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 controls which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. The “City of Columbus Fiscal Policies and Procedures for the Administration of HUD Grants Manual” Part II Section C – Standards for Documentation of Personal Services provides the following: All grant funded staff (both city staff and subrecipient staff) will utilize personal activity reports (timesheets). All timesheets will reflect total hours worked, identify the federal grant hours worked, and be signed by either the employee or the supervisor. Furthermore, the City of Columbus Department of Development has established a procedure of timesheet review which requires supervisors review employee timesheets within one week of the pay period end date. This review is evidenced by an electronic signature on the employee-completed timesheet.While the City does have an internal control policy in place in accordance with 2 CFR 430(i)(1)(i), supervisors were not always adhering to the policy which resulted in a deficiency in the application of the control process. During payroll control testing over AL #14.239 Home Investment Partnership Program, it was noted 3 out of the 5 selected worklogs (60%) were not signed by the supervisor within the one-week requirement as required by City policy. Supervisory sign offs occurred between 12 and 32 working days (not including weekends) following the end of the pay period.Failure to follow the established internal control policy and ensuring all time sheets are appropriately approved by a knowledgeable supervisor, within one week of the pay period end date, could result in unallowable costs being allocated to a federal program and could ultimately result in noncompliance and/or a questioned cost. The City should review established policies and procedures with supervisory personnel and evaluate if additional control procedures should be in place to ensure all timesheets are appropriately reviewed timely prior to allocation to a federal program.
2 CFR §2400.101 gives regulatory effect to the Department of Housing and Urban Development for 2 CFR §200.303(a) which states that the 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 be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Furthermore, 2 CFR §200.430(i)(1)(i) states "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 controls which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. The “City of Columbus Fiscal Policies and Procedures for the Administration of HUD Grants Manual” Part II Section C – Standards for Documentation of Personal Services provides the following: All grant funded staff (both city staff and subrecipient staff) will utilize personal activity reports (timesheets). All timesheets will reflect total hours worked, identify the federal grant hours worked, and be signed by either the employee or the supervisor. Furthermore, the City of Columbus Department of Development has established a procedure of timesheet review which requires supervisors review employee timesheets within one week of the pay period end date. This review is evidenced by an electronic signature on the employee-completed timesheet.While the City does have an internal control policy in place in accordance with 2 CFR 430(i)(1)(i), supervisors were not always adhering to the policy which resulted in a deficiency in the application of the control process. During payroll control testing over AL #14.239 Home Investment Partnership Program, it was noted 3 out of the 5 selected worklogs (60%) were not signed by the supervisor within the one-week requirement as required by City policy. Supervisory sign offs occurred between 12 and 32 working days (not including weekends) following the end of the pay period.Failure to follow the established internal control policy and ensuring all time sheets are appropriately approved by a knowledgeable supervisor, within one week of the pay period end date, could result in unallowable costs being allocated to a federal program and could ultimately result in noncompliance and/or a questioned cost. The City should review established policies and procedures with supervisory personnel and evaluate if additional control procedures should be in place to ensure all timesheets are appropriately reviewed timely prior to allocation to a federal program.
2 CFR §2400.101 gives regulatory effect to the Department of Housing and Urban Development for 2 CFR §200.303(a) which states that the 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 be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Furthermore, 2 CFR §200.430(i)(1)(i) states "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 controls which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. The “City of Columbus Fiscal Policies and Procedures for the Administration of HUD Grants Manual” Part II Section C – Standards for Documentation of Personal Services provides the following: All grant funded staff (both city staff and subrecipient staff) will utilize personal activity reports (timesheets). All timesheets will reflect total hours worked, identify the federal grant hours worked, and be signed by either the employee or the supervisor. Furthermore, the City of Columbus Department of Development has established a procedure of timesheet review which requires supervisors review employee timesheets within one week of the pay period end date. This review is evidenced by an electronic signature on the employee-completed timesheet.While the City does have an internal control policy in place in accordance with 2 CFR 430(i)(1)(i), supervisors were not always adhering to the policy which resulted in a deficiency in the application of the control process. During payroll control testing over AL #14.239 Home Investment Partnership Program, it was noted 3 out of the 5 selected worklogs (60%) were not signed by the supervisor within the one-week requirement as required by City policy. Supervisory sign offs occurred between 12 and 32 working days (not including weekends) following the end of the pay period.Failure to follow the established internal control policy and ensuring all time sheets are appropriately approved by a knowledgeable supervisor, within one week of the pay period end date, could result in unallowable costs being allocated to a federal program and could ultimately result in noncompliance and/or a questioned cost. The City should review established policies and procedures with supervisory personnel and evaluate if additional control procedures should be in place to ensure all timesheets are appropriately reviewed timely prior to allocation to a federal program.
2 CFR §2400.101 gives regulatory effect to the Department of Housing and Urban Development for 2 CFR §200.303(a) which states that the 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 be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Furthermore, 2 CFR §200.430(i)(1)(i) states "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 controls which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. The “City of Columbus Fiscal Policies and Procedures for the Administration of HUD Grants Manual” Part II Section C – Standards for Documentation of Personal Services provides the following: All grant funded staff (both city staff and subrecipient staff) will utilize personal activity reports (timesheets). All timesheets will reflect total hours worked, identify the federal grant hours worked, and be signed by either the employee or the supervisor. Furthermore, the City of Columbus Department of Development has established a procedure of timesheet review which requires supervisors review employee timesheets within one week of the pay period end date. This review is evidenced by an electronic signature on the employee-completed timesheet.While the City does have an internal control policy in place in accordance with 2 CFR 430(i)(1)(i), supervisors were not always adhering to the policy which resulted in a deficiency in the application of the control process. During payroll control testing over AL #14.239 Home Investment Partnership Program, it was noted 3 out of the 5 selected worklogs (60%) were not signed by the supervisor within the one-week requirement as required by City policy. Supervisory sign offs occurred between 12 and 32 working days (not including weekends) following the end of the pay period.Failure to follow the established internal control policy and ensuring all time sheets are appropriately approved by a knowledgeable supervisor, within one week of the pay period end date, could result in unallowable costs being allocated to a federal program and could ultimately result in noncompliance and/or a questioned cost. The City should review established policies and procedures with supervisory personnel and evaluate if additional control procedures should be in place to ensure all timesheets are appropriately reviewed timely prior to allocation to a federal program.
2 CFR §2400.101 gives regulatory effect to the Department of Housing and Urban Development for 2 CFR §200.303(a) which states that the 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 be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Furthermore, 2 CFR §200.430(i)(1)(i) states "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 controls which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. The “City of Columbus Fiscal Policies and Procedures for the Administration of HUD Grants Manual” Part II Section C – Standards for Documentation of Personal Services provides the following: All grant funded staff (both city staff and subrecipient staff) will utilize personal activity reports (timesheets). All timesheets will reflect total hours worked, identify the federal grant hours worked, and be signed by either the employee or the supervisor. Furthermore, the City of Columbus Department of Development has established a procedure of timesheet review which requires supervisors review employee timesheets within one week of the pay period end date. This review is evidenced by an electronic signature on the employee-completed timesheet.While the City does have an internal control policy in place in accordance with 2 CFR 430(i)(1)(i), supervisors were not always adhering to the policy which resulted in a deficiency in the application of the control process. During payroll control testing over AL #14.239 Home Investment Partnership Program, it was noted 3 out of the 5 selected worklogs (60%) were not signed by the supervisor within the one-week requirement as required by City policy. Supervisory sign offs occurred between 12 and 32 working days (not including weekends) following the end of the pay period.Failure to follow the established internal control policy and ensuring all time sheets are appropriately approved by a knowledgeable supervisor, within one week of the pay period end date, could result in unallowable costs being allocated to a federal program and could ultimately result in noncompliance and/or a questioned cost. The City should review established policies and procedures with supervisory personnel and evaluate if additional control procedures should be in place to ensure all timesheets are appropriately reviewed timely prior to allocation to a federal program.
2 CFR §2400.101 gives regulatory effect to the Department of Housing and Urban Development for 2 CFR §200.303(a) which states that the 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 be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Furthermore, 2 CFR §200.430(i)(1)(i) states "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 controls which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. The “City of Columbus Fiscal Policies and Procedures for the Administration of HUD Grants Manual” Part II Section C – Standards for Documentation of Personal Services provides the following: All grant funded staff (both city staff and subrecipient staff) will utilize personal activity reports (timesheets). All timesheets will reflect total hours worked, identify the federal grant hours worked, and be signed by either the employee or the supervisor. Furthermore, the City of Columbus Department of Development has established a procedure of timesheet review which requires supervisors review employee timesheets within one week of the pay period end date. This review is evidenced by an electronic signature on the employee-completed timesheet.While the City does have an internal control policy in place in accordance with 2 CFR 430(i)(1)(i), supervisors were not always adhering to the policy which resulted in a deficiency in the application of the control process. During payroll control testing over AL #14.239 Home Investment Partnership Program, it was noted 3 out of the 5 selected worklogs (60%) were not signed by the supervisor within the one-week requirement as required by City policy. Supervisory sign offs occurred between 12 and 32 working days (not including weekends) following the end of the pay period.Failure to follow the established internal control policy and ensuring all time sheets are appropriately approved by a knowledgeable supervisor, within one week of the pay period end date, could result in unallowable costs being allocated to a federal program and could ultimately result in noncompliance and/or a questioned cost. The City should review established policies and procedures with supervisory personnel and evaluate if additional control procedures should be in place to ensure all timesheets are appropriately reviewed timely prior to allocation to a federal program.
2 CFR §2400.101 gives regulatory effect to the Department of Housing and Urban Development for 2 CFR §200.303(a) which states that the 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 be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Furthermore, 2 CFR §200.430(i)(1)(i) states "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 controls which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. The “City of Columbus Fiscal Policies and Procedures for the Administration of HUD Grants Manual” Part II Section C – Standards for Documentation of Personal Services provides the following: All grant funded staff (both city staff and subrecipient staff) will utilize personal activity reports (timesheets). All timesheets will reflect total hours worked, identify the federal grant hours worked, and be signed by either the employee or the supervisor. Furthermore, the City of Columbus Department of Development has established a procedure of timesheet review which requires supervisors review employee timesheets within one week of the pay period end date. This review is evidenced by an electronic signature on the employee-completed timesheet.While the City does have an internal control policy in place in accordance with 2 CFR 430(i)(1)(i), supervisors were not always adhering to the policy which resulted in a deficiency in the application of the control process. During payroll control testing over AL #14.239 Home Investment Partnership Program, it was noted 3 out of the 5 selected worklogs (60%) were not signed by the supervisor within the one-week requirement as required by City policy. Supervisory sign offs occurred between 12 and 32 working days (not including weekends) following the end of the pay period.Failure to follow the established internal control policy and ensuring all time sheets are appropriately approved by a knowledgeable supervisor, within one week of the pay period end date, could result in unallowable costs being allocated to a federal program and could ultimately result in noncompliance and/or a questioned cost. The City should review established policies and procedures with supervisory personnel and evaluate if additional control procedures should be in place to ensure all timesheets are appropriately reviewed timely prior to allocation to a federal program.
2 CFR §2400.101 gives regulatory effect to the Department of Housing and Urban Development for 2 CFR §200.303(a) which states that the 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 be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Furthermore, 2 CFR §200.430(i)(1)(i) states "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 controls which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. The “City of Columbus Fiscal Policies and Procedures for the Administration of HUD Grants Manual” Part II Section C – Standards for Documentation of Personal Services provides the following: All grant funded staff (both city staff and subrecipient staff) will utilize personal activity reports (timesheets). All timesheets will reflect total hours worked, identify the federal grant hours worked, and be signed by either the employee or the supervisor. Furthermore, the City of Columbus Department of Development has established a procedure of timesheet review which requires supervisors review employee timesheets within one week of the pay period end date. This review is evidenced by an electronic signature on the employee-completed timesheet.While the City does have an internal control policy in place in accordance with 2 CFR 430(i)(1)(i), supervisors were not always adhering to the policy which resulted in a deficiency in the application of the control process. During payroll control testing over AL #14.239 Home Investment Partnership Program, it was noted 3 out of the 5 selected worklogs (60%) were not signed by the supervisor within the one-week requirement as required by City policy. Supervisory sign offs occurred between 12 and 32 working days (not including weekends) following the end of the pay period.Failure to follow the established internal control policy and ensuring all time sheets are appropriately approved by a knowledgeable supervisor, within one week of the pay period end date, could result in unallowable costs being allocated to a federal program and could ultimately result in noncompliance and/or a questioned cost. The City should review established policies and procedures with supervisory personnel and evaluate if additional control procedures should be in place to ensure all timesheets are appropriately reviewed timely prior to allocation to a federal program.
Criteria or Specific Requirement: Federal regulations (45 CFR 1635.4(a) and 2 CFR 200.430), state that federal award recipients must base allocations of salaries and wages costs to grants on records that accurately reflect the work performed. Federal regulations (45 CFR 1630.5 and 2 CFR 200.403) state that expenditures are allowable under an LSC (or federal) grant or contract only if the recipient can demonstrate that the cost was consistent with accounting policies and procedures that apply uniformly to both LSC (or, federal)-funded and non-LSC (of, federal) -funded activities. Condition: During our testing we noted: Payroll transactions: Eleven instances of errors totaling a net amount of $2,009 (an absolute value amount of $2,009) where the incorrect percentages were utilized in the allocation of the employee's pay, the incorrect employee's time was used in the allocation of the employee's pay, or there were unsupported amounts added to the allocation of the employee’s pay, and Payroll transactions: Seven instances of errors totaling a net amount of $109 (an absolute value amount of $4,405) where an unsupported allocation percentage was used to allocate the employee's pay to the grant - typically, employee salaries are allocated to LSC and two other private grants using an allocation base of a LSC cost driver for the period divided by the total cost driver coded to the Organization’s general fund. Fringe-benefit transactions: Two instances of an error totaling $91 where an unsupported allocation percentage was used to allocate employer-paid employee insurance costs to the grant - typically, costs are allocated to LSC and two other private grants using an allocation base of a LSC cost driver for the period divided by the total cost driver coded to the Organization’s general fund. Fringe-benefit transactions: Two instances of errors totaling $275 where employer-paid employee insurance and HSA contribution deductions per the employee's pay stub were allocated to the grant at a rate of 100%. Non-payroll and fringe transactions: one instance of an error totaling $884 where an unsupported allocation percentage was used to allocate general costs to the grant - typically, costs are allocated to LSC and two other private grants using an allocation base of a LSC cost driver for the period divided by the total cost driver coded to the Organization’s general fund. Additionally, we noted inconsistency in the general fund (LSC and two other private grants) allocation basis used during the year - grant hours and projected revenue were both utilized at different times during the year. Additionally, we noted that allocations in the general fund are done using projected revenue. However as revenue was recognized as expenses were incurred for the general fund the allocation based on revenue approximated an allocation method based on costs. As such, the costs mentioned above were allocated in an inconsistent manner to other grant costs and were not fully representative of the employees’ time and effort. However, we noted a lower frequency of differences in sample selections that occurred during the last several months of the year after management implemented a change to its allocation processes in response to the prior year audit. 2024 – 002: Cost Allocation of Expenses to LSC Grants (Continued) Questioned Costs: A net amount of $3,150 of allocated salary expense described above, which is related to Assistance Listing Number 09.706060. Context: These 23 instances were noting during testing of 55 disbursements. Cause: The Organization’s cost allocation methodology is primarily based on time and effort records, and periodic calculations of a LSC cost driver for the period divided by the total cost driver coded to the Organization’s general fund, but it often includes manual adjustments based on review of individual time records, expense and other data. Therefore, the methodology is challenging to apply consistently, document contemporaneously, and apply in accordance with federal regulations. Effect: The inclusion of frequent manual adjustments in the Organization’s cost allocation methodology could cause costs to be allocated to grants that are not reflective of the time and effort spent on grant activities and in a manner where costs are not applied uniformly to both LSC (or, federally)-funded and non-LSC (of, federally) -funded activities. Repeat Finding: The finding is a repeat of findings in the immediately prior year. The prior year finding numbers were 2023-003 and 2023-004. Recommendation: We recommend that the Organization consider updating its cost allocation methodology and process to reduce the frequency of manual adjustments based on review of individual time records and expense data and maximize the use of automated allocations that are calculated in a consistent manner that ensure costs are applied uniformly to respective benefited activities, and that are reflective on employees’ time and effort records Views of responsible officials: Management partially agrees with this finding. First, 45 CFR Part 1635 codifies the timekeeping requirement. CLS keeps track of every case and time dedicated by staff in strict compliance with this requirement. Additionally, the distribution of expenses in the general fund, which includes LSC and two other funding sources, represents a fair method and allocation. Regarding the questioned costs, CLS disagrees with the finding of material weakness given the extremely low total dollar value. Auditor’s Concluding Remarks: Management’s response did not persuade the auditor to revise the finding. Federal regulations state that expenditures are allowable under an LSC (or federal) grant or contract only if the recipient can demonstrate that the cost was consistent with accounting policies and procedures that apply uniformly to both LSC (or, federal)-funded and non-LSC (of, federal) -funded activities.
Criteria or Specific Requirement: Federal regulations (45 CFR 1635.4(a) and 2 CFR 200.430), state that federal award recipients must base allocations of salaries and wages costs to grants on records that accurately reflect the work performed. Federal regulations (45 CFR 1630.5 and 2 CFR 200.403) state that expenditures are allowable under an LSC (or federal) grant or contract only if the recipient can demonstrate that the cost was consistent with accounting policies and procedures that apply uniformly to both LSC (or, federal)-funded and non-LSC (of, federal) -funded activities. Condition: During our testing we noted: Payroll transactions: Eleven instances of errors totaling a net amount of $2,009 (an absolute value amount of $2,009) where the incorrect percentages were utilized in the allocation of the employee's pay, the incorrect employee's time was used in the allocation of the employee's pay, or there were unsupported amounts added to the allocation of the employee’s pay, and Payroll transactions: Seven instances of errors totaling a net amount of $109 (an absolute value amount of $4,405) where an unsupported allocation percentage was used to allocate the employee's pay to the grant - typically, employee salaries are allocated to LSC and two other private grants using an allocation base of a LSC cost driver for the period divided by the total cost driver coded to the Organization’s general fund. Fringe-benefit transactions: Two instances of an error totaling $91 where an unsupported allocation percentage was used to allocate employer-paid employee insurance costs to the grant - typically, costs are allocated to LSC and two other private grants using an allocation base of a LSC cost driver for the period divided by the total cost driver coded to the Organization’s general fund. Fringe-benefit transactions: Two instances of errors totaling $275 where employer-paid employee insurance and HSA contribution deductions per the employee's pay stub were allocated to the grant at a rate of 100%. Non-payroll and fringe transactions: one instance of an error totaling $884 where an unsupported allocation percentage was used to allocate general costs to the grant - typically, costs are allocated to LSC and two other private grants using an allocation base of a LSC cost driver for the period divided by the total cost driver coded to the Organization’s general fund. Additionally, we noted inconsistency in the general fund (LSC and two other private grants) allocation basis used during the year - grant hours and projected revenue were both utilized at different times during the year. Additionally, we noted that allocations in the general fund are done using projected revenue. However as revenue was recognized as expenses were incurred for the general fund the allocation based on revenue approximated an allocation method based on costs. As such, the costs mentioned above were allocated in an inconsistent manner to other grant costs and were not fully representative of the employees’ time and effort. However, we noted a lower frequency of differences in sample selections that occurred during the last several months of the year after management implemented a change to its allocation processes in response to the prior year audit. 2024 – 002: Cost Allocation of Expenses to LSC Grants (Continued) Questioned Costs: A net amount of $3,150 of allocated salary expense described above, which is related to Assistance Listing Number 09.706060. Context: These 23 instances were noting during testing of 55 disbursements. Cause: The Organization’s cost allocation methodology is primarily based on time and effort records, and periodic calculations of a LSC cost driver for the period divided by the total cost driver coded to the Organization’s general fund, but it often includes manual adjustments based on review of individual time records, expense and other data. Therefore, the methodology is challenging to apply consistently, document contemporaneously, and apply in accordance with federal regulations. Effect: The inclusion of frequent manual adjustments in the Organization’s cost allocation methodology could cause costs to be allocated to grants that are not reflective of the time and effort spent on grant activities and in a manner where costs are not applied uniformly to both LSC (or, federally)-funded and non-LSC (of, federally) -funded activities. Repeat Finding: The finding is a repeat of findings in the immediately prior year. The prior year finding numbers were 2023-003 and 2023-004. Recommendation: We recommend that the Organization consider updating its cost allocation methodology and process to reduce the frequency of manual adjustments based on review of individual time records and expense data and maximize the use of automated allocations that are calculated in a consistent manner that ensure costs are applied uniformly to respective benefited activities, and that are reflective on employees’ time and effort records Views of responsible officials: Management partially agrees with this finding. First, 45 CFR Part 1635 codifies the timekeeping requirement. CLS keeps track of every case and time dedicated by staff in strict compliance with this requirement. Additionally, the distribution of expenses in the general fund, which includes LSC and two other funding sources, represents a fair method and allocation. Regarding the questioned costs, CLS disagrees with the finding of material weakness given the extremely low total dollar value. Auditor’s Concluding Remarks: Management’s response did not persuade the auditor to revise the finding. Federal regulations state that expenditures are allowable under an LSC (or federal) grant or contract only if the recipient can demonstrate that the cost was consistent with accounting policies and procedures that apply uniformly to both LSC (or, federal)-funded and non-LSC (of, federal) -funded activities.
Criteria or Specific Requirement: Federal regulations (45 CFR 1635.4(a) and 2 CFR 200.430), state that federal award recipients must base allocations of salaries and wages costs to grants on records that accurately reflect the work performed. Federal regulations (45 CFR 1630.5 and 2 CFR 200.403) state that expenditures are allowable under an LSC (or federal) grant or contract only if the recipient can demonstrate that the cost was consistent with accounting policies and procedures that apply uniformly to both LSC (or, federal)-funded and non-LSC (of, federal) -funded activities. Condition: During our testing we noted: Payroll transactions: Eleven instances of errors totaling a net amount of $2,009 (an absolute value amount of $2,009) where the incorrect percentages were utilized in the allocation of the employee's pay, the incorrect employee's time was used in the allocation of the employee's pay, or there were unsupported amounts added to the allocation of the employee’s pay, and Payroll transactions: Seven instances of errors totaling a net amount of $109 (an absolute value amount of $4,405) where an unsupported allocation percentage was used to allocate the employee's pay to the grant - typically, employee salaries are allocated to LSC and two other private grants using an allocation base of a LSC cost driver for the period divided by the total cost driver coded to the Organization’s general fund. Fringe-benefit transactions: Two instances of an error totaling $91 where an unsupported allocation percentage was used to allocate employer-paid employee insurance costs to the grant - typically, costs are allocated to LSC and two other private grants using an allocation base of a LSC cost driver for the period divided by the total cost driver coded to the Organization’s general fund. Fringe-benefit transactions: Two instances of errors totaling $275 where employer-paid employee insurance and HSA contribution deductions per the employee's pay stub were allocated to the grant at a rate of 100%. Non-payroll and fringe transactions: one instance of an error totaling $884 where an unsupported allocation percentage was used to allocate general costs to the grant - typically, costs are allocated to LSC and two other private grants using an allocation base of a LSC cost driver for the period divided by the total cost driver coded to the Organization’s general fund. Additionally, we noted inconsistency in the general fund (LSC and two other private grants) allocation basis used during the year - grant hours and projected revenue were both utilized at different times during the year. Additionally, we noted that allocations in the general fund are done using projected revenue. However as revenue was recognized as expenses were incurred for the general fund the allocation based on revenue approximated an allocation method based on costs. As such, the costs mentioned above were allocated in an inconsistent manner to other grant costs and were not fully representative of the employees’ time and effort. However, we noted a lower frequency of differences in sample selections that occurred during the last several months of the year after management implemented a change to its allocation processes in response to the prior year audit. 2024 – 002: Cost Allocation of Expenses to LSC Grants (Continued) Questioned Costs: A net amount of $3,150 of allocated salary expense described above, which is related to Assistance Listing Number 09.706060. Context: These 23 instances were noting during testing of 55 disbursements. Cause: The Organization’s cost allocation methodology is primarily based on time and effort records, and periodic calculations of a LSC cost driver for the period divided by the total cost driver coded to the Organization’s general fund, but it often includes manual adjustments based on review of individual time records, expense and other data. Therefore, the methodology is challenging to apply consistently, document contemporaneously, and apply in accordance with federal regulations. Effect: The inclusion of frequent manual adjustments in the Organization’s cost allocation methodology could cause costs to be allocated to grants that are not reflective of the time and effort spent on grant activities and in a manner where costs are not applied uniformly to both LSC (or, federally)-funded and non-LSC (of, federally) -funded activities. Repeat Finding: The finding is a repeat of findings in the immediately prior year. The prior year finding numbers were 2023-003 and 2023-004. Recommendation: We recommend that the Organization consider updating its cost allocation methodology and process to reduce the frequency of manual adjustments based on review of individual time records and expense data and maximize the use of automated allocations that are calculated in a consistent manner that ensure costs are applied uniformly to respective benefited activities, and that are reflective on employees’ time and effort records Views of responsible officials: Management partially agrees with this finding. First, 45 CFR Part 1635 codifies the timekeeping requirement. CLS keeps track of every case and time dedicated by staff in strict compliance with this requirement. Additionally, the distribution of expenses in the general fund, which includes LSC and two other funding sources, represents a fair method and allocation. Regarding the questioned costs, CLS disagrees with the finding of material weakness given the extremely low total dollar value. Auditor’s Concluding Remarks: Management’s response did not persuade the auditor to revise the finding. Federal regulations state that expenditures are allowable under an LSC (or federal) grant or contract only if the recipient can demonstrate that the cost was consistent with accounting policies and procedures that apply uniformly to both LSC (or, federal)-funded and non-LSC (of, federal) -funded activities.
Significant deficiency in internal control over compliance and noncompliance related to allowable costs/cost principles compliance requirements. Federal Agency: U.S. Department of Treasury Pass-Through Entity: City and County of Denver Program Title: Coronavirus State and Local Fiscal Recovery Funds Assistance Listing Number: 21.027 Award Number: 202474319 Criteria Nonfederal entities must follow the standards for documentation of personnel expenses set out at 2 CFR section 200.430(i). Under those standards, charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. Additionally, those standards require that the records a) reasonably reflect the total activity for which the employee is compensated by the nonfederal entity, not exceeding 100% of compensated activities; b) 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 nonfederal 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; and c) budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards. Budget estimates may be used for interim account 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 and Context The Organization maintains a timekeeping and payroll system for charges to federal awards that documents approved wage and salary rates, time and effort certification, hours, and actual amounts paid to employees. The Organization is allocating payroll costs to federal programs for individual employees using budget estimates of time and effort on different activities. The Organization maintains after-the-fact review documentation of time spent for each employee to support the allocation in the form of “Time and Effort” certifications that are signed by all employees and supervisors to verify actual time spent on major program. During our testing we noted two pay-periods for one employee where the Organization did not maintain the “Time and Effort” certification. Section III - Reportable Findings and Questioned Costs for Federal Awards Cause The Organization’s management noted that the missing certifications were due to the employee leaving employment before the certifications were completed for the two pay periods. The Organization did not have a process in place to ensure alternate certification documentation was created and retained in the situation of terminated employees. Effect The effect is that the Organization is not in compliance with the requirements of 2 CFR section 200.430(i) for the two pay periods for this employee. For two pay-periods for one employee the payroll costs charged to the major program were not supported by documentation of after-the-fact review evidencing that those costs reasonably reflect the work actually performed on the activity. Questioned Costs The expenditures for the two pay periods for the one employee totaled of $8,846. Repeat Finding This is not a repeat finding. Recommendation We recommend management update its internal control process for employees who depart or are unable to certify their timesheets to ensure all time spent on federal programs is certified by employees and their supervisors. Views of Responsible Official and Corrective Action Plan Management agrees with the finding and has provided the accompanying corrective action plan.
Finding 2024-002 Payroll Information on the Federal Programs: 93.421 Criteria or Specific Requirement (Including Statutory, Regulatory, or Other Citation): Per 2 CFR 200.430(i) of the Uniform Guidance, charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must support the distribution of employees’ salaries among specific activities or cost objectives as required. Condition: During our review of payroll charges to Federal awards, we noted that BCHC did not use timesheets from January 2024 to August 2024 and recorded salaries based on budgeted allocations. In August 2024, timesheets were implemented but we noted that the time recorded in the general ledger did not coincide with the allocation on the actual timesheets. Cause: BCHC relied on predetermined budget estimates for payroll allocation rather than using timesheets that reflected actual hours worked. Effect or Potential Effect: There is a risk that payroll costs charged to Federal programs may not accurately represent the true level of effort, potentially resulting in unallowable costs being charged to Federal awards. Questioned Costs: Indeterminate-The questioned costs relate to salary and wage expenditures charged to Federal programs without the required time and effort documentation in accordance with 2 CFR §200.430. Specifically, employees whose compensation was allocated to Federal awards did not maintain timesheets or equivalent records reflecting actual time worked on specific Federal activities. Due to the absence of these records, we were unable to determine the portion of personnel costs that may be unallowable under Uniform Guidance. Accordingly, the questioned costs are considered indeterminate. Context: We sampled 40 payroll transactions. All transactions were based on budgeted amounts. This issue was observed across all departments receiving Federal funds. Identification as a Repeat Finding, if Applicable: Not applicable Recommendation: While BCHC now maintains timesheets, we recommend ensuring that payroll costs charged to Federal awards are based on the actual time recorded, rather than budgeted estimates. The timesheet data should be used to support allocations in accordance with Uniform Guidance, and adjustments should be made as needed to reflect the actual effort expended on Federal programs.
Finding 2024-002 Payroll Information on the Federal Programs: 93.421 Criteria or Specific Requirement (Including Statutory, Regulatory, or Other Citation): Per 2 CFR 200.430(i) of the Uniform Guidance, charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must support the distribution of employees’ salaries among specific activities or cost objectives as required. Condition: During our review of payroll charges to Federal awards, we noted that BCHC did not use timesheets from January 2024 to August 2024 and recorded salaries based on budgeted allocations. In August 2024, timesheets were implemented but we noted that the time recorded in the general ledger did not coincide with the allocation on the actual timesheets. Cause: BCHC relied on predetermined budget estimates for payroll allocation rather than using timesheets that reflected actual hours worked. Effect or Potential Effect: There is a risk that payroll costs charged to Federal programs may not accurately represent the true level of effort, potentially resulting in unallowable costs being charged to Federal awards. Questioned Costs: Indeterminate-The questioned costs relate to salary and wage expenditures charged to Federal programs without the required time and effort documentation in accordance with 2 CFR §200.430. Specifically, employees whose compensation was allocated to Federal awards did not maintain timesheets or equivalent records reflecting actual time worked on specific Federal activities. Due to the absence of these records, we were unable to determine the portion of personnel costs that may be unallowable under Uniform Guidance. Accordingly, the questioned costs are considered indeterminate. Context: We sampled 40 payroll transactions. All transactions were based on budgeted amounts. This issue was observed across all departments receiving Federal funds. Identification as a Repeat Finding, if Applicable: Not applicable Recommendation: While BCHC now maintains timesheets, we recommend ensuring that payroll costs charged to Federal awards are based on the actual time recorded, rather than budgeted estimates. The timesheet data should be used to support allocations in accordance with Uniform Guidance, and adjustments should be made as needed to reflect the actual effort expended on Federal programs.
Finding 2024-002 Payroll Information on the Federal Programs: 93.421 Criteria or Specific Requirement (Including Statutory, Regulatory, or Other Citation): Per 2 CFR 200.430(i) of the Uniform Guidance, charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must support the distribution of employees’ salaries among specific activities or cost objectives as required. Condition: During our review of payroll charges to Federal awards, we noted that BCHC did not use timesheets from January 2024 to August 2024 and recorded salaries based on budgeted allocations. In August 2024, timesheets were implemented but we noted that the time recorded in the general ledger did not coincide with the allocation on the actual timesheets. Cause: BCHC relied on predetermined budget estimates for payroll allocation rather than using timesheets that reflected actual hours worked. Effect or Potential Effect: There is a risk that payroll costs charged to Federal programs may not accurately represent the true level of effort, potentially resulting in unallowable costs being charged to Federal awards. Questioned Costs: Indeterminate-The questioned costs relate to salary and wage expenditures charged to Federal programs without the required time and effort documentation in accordance with 2 CFR §200.430. Specifically, employees whose compensation was allocated to Federal awards did not maintain timesheets or equivalent records reflecting actual time worked on specific Federal activities. Due to the absence of these records, we were unable to determine the portion of personnel costs that may be unallowable under Uniform Guidance. Accordingly, the questioned costs are considered indeterminate. Context: We sampled 40 payroll transactions. All transactions were based on budgeted amounts. This issue was observed across all departments receiving Federal funds. Identification as a Repeat Finding, if Applicable: Not applicable Recommendation: While BCHC now maintains timesheets, we recommend ensuring that payroll costs charged to Federal awards are based on the actual time recorded, rather than budgeted estimates. The timesheet data should be used to support allocations in accordance with Uniform Guidance, and adjustments should be made as needed to reflect the actual effort expended on Federal programs.
Finding 2024-002 Payroll Information on the Federal Programs: 93.421 Criteria or Specific Requirement (Including Statutory, Regulatory, or Other Citation): Per 2 CFR 200.430(i) of the Uniform Guidance, charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must support the distribution of employees’ salaries among specific activities or cost objectives as required. Condition: During our review of payroll charges to Federal awards, we noted that BCHC did not use timesheets from January 2024 to August 2024 and recorded salaries based on budgeted allocations. In August 2024, timesheets were implemented but we noted that the time recorded in the general ledger did not coincide with the allocation on the actual timesheets. Cause: BCHC relied on predetermined budget estimates for payroll allocation rather than using timesheets that reflected actual hours worked. Effect or Potential Effect: There is a risk that payroll costs charged to Federal programs may not accurately represent the true level of effort, potentially resulting in unallowable costs being charged to Federal awards. Questioned Costs: Indeterminate-The questioned costs relate to salary and wage expenditures charged to Federal programs without the required time and effort documentation in accordance with 2 CFR §200.430. Specifically, employees whose compensation was allocated to Federal awards did not maintain timesheets or equivalent records reflecting actual time worked on specific Federal activities. Due to the absence of these records, we were unable to determine the portion of personnel costs that may be unallowable under Uniform Guidance. Accordingly, the questioned costs are considered indeterminate. Context: We sampled 40 payroll transactions. All transactions were based on budgeted amounts. This issue was observed across all departments receiving Federal funds. Identification as a Repeat Finding, if Applicable: Not applicable Recommendation: While BCHC now maintains timesheets, we recommend ensuring that payroll costs charged to Federal awards are based on the actual time recorded, rather than budgeted estimates. The timesheet data should be used to support allocations in accordance with Uniform Guidance, and adjustments should be made as needed to reflect the actual effort expended on Federal programs.
Finding 2024-002 Payroll Information on the Federal Programs: 93.421 Criteria or Specific Requirement (Including Statutory, Regulatory, or Other Citation): Per 2 CFR 200.430(i) of the Uniform Guidance, charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must support the distribution of employees’ salaries among specific activities or cost objectives as required. Condition: During our review of payroll charges to Federal awards, we noted that BCHC did not use timesheets from January 2024 to August 2024 and recorded salaries based on budgeted allocations. In August 2024, timesheets were implemented but we noted that the time recorded in the general ledger did not coincide with the allocation on the actual timesheets. Cause: BCHC relied on predetermined budget estimates for payroll allocation rather than using timesheets that reflected actual hours worked. Effect or Potential Effect: There is a risk that payroll costs charged to Federal programs may not accurately represent the true level of effort, potentially resulting in unallowable costs being charged to Federal awards. Questioned Costs: Indeterminate-The questioned costs relate to salary and wage expenditures charged to Federal programs without the required time and effort documentation in accordance with 2 CFR §200.430. Specifically, employees whose compensation was allocated to Federal awards did not maintain timesheets or equivalent records reflecting actual time worked on specific Federal activities. Due to the absence of these records, we were unable to determine the portion of personnel costs that may be unallowable under Uniform Guidance. Accordingly, the questioned costs are considered indeterminate. Context: We sampled 40 payroll transactions. All transactions were based on budgeted amounts. This issue was observed across all departments receiving Federal funds. Identification as a Repeat Finding, if Applicable: Not applicable Recommendation: While BCHC now maintains timesheets, we recommend ensuring that payroll costs charged to Federal awards are based on the actual time recorded, rather than budgeted estimates. The timesheet data should be used to support allocations in accordance with Uniform Guidance, and adjustments should be made as needed to reflect the actual effort expended on Federal programs.
Finding 2024-002 Payroll Information on the Federal Programs: 93.421 Criteria or Specific Requirement (Including Statutory, Regulatory, or Other Citation): Per 2 CFR 200.430(i) of the Uniform Guidance, charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must support the distribution of employees’ salaries among specific activities or cost objectives as required. Condition: During our review of payroll charges to Federal awards, we noted that BCHC did not use timesheets from January 2024 to August 2024 and recorded salaries based on budgeted allocations. In August 2024, timesheets were implemented but we noted that the time recorded in the general ledger did not coincide with the allocation on the actual timesheets. Cause: BCHC relied on predetermined budget estimates for payroll allocation rather than using timesheets that reflected actual hours worked. Effect or Potential Effect: There is a risk that payroll costs charged to Federal programs may not accurately represent the true level of effort, potentially resulting in unallowable costs being charged to Federal awards. Questioned Costs: Indeterminate-The questioned costs relate to salary and wage expenditures charged to Federal programs without the required time and effort documentation in accordance with 2 CFR §200.430. Specifically, employees whose compensation was allocated to Federal awards did not maintain timesheets or equivalent records reflecting actual time worked on specific Federal activities. Due to the absence of these records, we were unable to determine the portion of personnel costs that may be unallowable under Uniform Guidance. Accordingly, the questioned costs are considered indeterminate. Context: We sampled 40 payroll transactions. All transactions were based on budgeted amounts. This issue was observed across all departments receiving Federal funds. Identification as a Repeat Finding, if Applicable: Not applicable Recommendation: While BCHC now maintains timesheets, we recommend ensuring that payroll costs charged to Federal awards are based on the actual time recorded, rather than budgeted estimates. The timesheet data should be used to support allocations in accordance with Uniform Guidance, and adjustments should be made as needed to reflect the actual effort expended on Federal programs.
2024-001 Twenty-First Century Community Learning Centers – Assistance Listing No. 84.287 Material Weakness in Internal Control Over Compliance and Noncompliance – Inadequate Payroll Documentation B. Allowable Costs/Cost Principles 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 and are supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. As part of the Organization’s internal controls, time and effort documentation—such as timecards—should be reviewed and approved by the employee to confirm accuracy. Condition and Context: We selected 40 individuals paid in randomly selected pay periods for testing. Our sample was not statistically valid. During our testing of payroll expenses charged to the federal program, we noted that 2 out of 40 of the employee timecards selected for review were not signed or electronically certified by the respective employee. Without employee attestation, the accuracy of the reported time cannot be verified in accordance with Uniform Guidance requirements. This resulted in total questioned costs of $763. Based on an error rate of 3.23%, the likely questioned costs for the full payroll population are projected to be $14,578. Additionally, we identified 10 instances where the number of hours reported on employee timecards did not match the hours recorded in the payroll system and charged to the federal award. The total questioned costs for these discrepancies were $569. Based on an error rate of 2.41%, the likely questioned costs for the full payroll population are projected to be $10,878. This is a repeat finding of 2023-003. Cause and Effect: The lack of employee signatures appears to be due to inconsistent enforcement of timecard approval procedures. The discrepancies in the number of hours charged to the federal award appear to be due to a lack of effective reconciliation procedures between timekeeping and payroll records. As a result of these items noted above, the Organization charged unsubstantiated payroll costs to the federal award. Recommendation: We recommend that management ensure all employee timecards are signed or electronically certified by the employee in a timely manner. We also recommend a process is implemented to reconcile time charge to federal award to underlying payroll report. Internal controls should be reinforced to verify that no payroll costs are charged to federal programs without appropriate documentation and approval. Views of Responsible Officials and Planned Corrective Action: We agree with the recommendation and updated our written policy in 2024. The policy was reviewed by the Finance Committee and approved by the full Board of Directors in December 2024.
2024-001 Significant Deficiency in Internal Control and Compliance over Major Programs Funding Agency: Department of Treasury ALN: 21.027 Funding Agency: Department of Agriculture ALNs: 10.565, 10.568 & 10.569 Criteria Internal controls and other compliance knowledge should prevent the incorrect coding of employee hours worked. Per 2 CFR 200.430(g)(1), "charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed" and "be supported by a system of internal control that provides reasonable assurance that the charges are accurate, allowable and properly allocated." Condition Internal controls and adherence to compliance were not followed with regards to an appropriate level of approval of management that is charged to the Coronavirus State and Local Recovery Funds program and the Food Cluster Program. Questioned costs Total questioned cost of $2,822 based on three payroll transactions tested that were not approved at the appropriate level but were charged to the Coronavirus State and Local Recovery Fund grant (ALN 21.027). Total questioned cost of $3,475 based on three payroll transactions tested that were not approved at the appropriate level but were charged to the Food Cluster Program (ALNs 10.565, 10.568, & 10.569). Context During our payroll testing, of the six executive director timesheets tested, none of them indicated a review or approval from the board president. Cause The error was caused by not applying an adequate number of controls necessary for the executive director's timesheet. Effect The Coronavirus State and Local Recovery Funds program and Food Cluster program and other federal programs could be incorrectly charged with unreasonable wages.Repeat Finding No. Auditor's Recommendation We recommend that the board president or other board member designee review the executive director's timesheet prior to submitting the wages for reimbursement from federal grants.
2024-001 Significant Deficiency in Internal Control and Compliance over Major Programs Funding Agency: Department of Treasury ALN: 21.027 Funding Agency: Department of Agriculture ALNs: 10.565, 10.568 & 10.569 Criteria Internal controls and other compliance knowledge should prevent the incorrect coding of employee hours worked. Per 2 CFR 200.430(g)(1), "charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed" and "be supported by a system of internal control that provides reasonable assurance that the charges are accurate, allowable and properly allocated." Condition Internal controls and adherence to compliance were not followed with regards to an appropriate level of approval of management that is charged to the Coronavirus State and Local Recovery Funds program and the Food Cluster Program. Questioned costs Total questioned cost of $2,822 based on three payroll transactions tested that were not approved at the appropriate level but were charged to the Coronavirus State and Local Recovery Fund grant (ALN 21.027). Total questioned cost of $3,475 based on three payroll transactions tested that were not approved at the appropriate level but were charged to the Food Cluster Program (ALNs 10.565, 10.568, & 10.569). Context During our payroll testing, of the six executive director timesheets tested, none of them indicated a review or approval from the board president. Cause The error was caused by not applying an adequate number of controls necessary for the executive director's timesheet. Effect The Coronavirus State and Local Recovery Funds program and Food Cluster program and other federal programs could be incorrectly charged with unreasonable wages.Repeat Finding No. Auditor's Recommendation We recommend that the board president or other board member designee review the executive director's timesheet prior to submitting the wages for reimbursement from federal grants.
2024-001 Significant Deficiency in Internal Control and Compliance over Major Programs Funding Agency: Department of Treasury ALN: 21.027 Funding Agency: Department of Agriculture ALNs: 10.565, 10.568 & 10.569 Criteria Internal controls and other compliance knowledge should prevent the incorrect coding of employee hours worked. Per 2 CFR 200.430(g)(1), "charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed" and "be supported by a system of internal control that provides reasonable assurance that the charges are accurate, allowable and properly allocated." Condition Internal controls and adherence to compliance were not followed with regards to an appropriate level of approval of management that is charged to the Coronavirus State and Local Recovery Funds program and the Food Cluster Program. Questioned costs Total questioned cost of $2,822 based on three payroll transactions tested that were not approved at the appropriate level but were charged to the Coronavirus State and Local Recovery Fund grant (ALN 21.027). Total questioned cost of $3,475 based on three payroll transactions tested that were not approved at the appropriate level but were charged to the Food Cluster Program (ALNs 10.565, 10.568, & 10.569). Context During our payroll testing, of the six executive director timesheets tested, none of them indicated a review or approval from the board president. Cause The error was caused by not applying an adequate number of controls necessary for the executive director's timesheet. Effect The Coronavirus State and Local Recovery Funds program and Food Cluster program and other federal programs could be incorrectly charged with unreasonable wages.Repeat Finding No. Auditor's Recommendation We recommend that the board president or other board member designee review the executive director's timesheet prior to submitting the wages for reimbursement from federal grants.
2024-001 Significant Deficiency in Internal Control and Compliance over Major Programs Funding Agency: Department of Treasury ALN: 21.027 Funding Agency: Department of Agriculture ALNs: 10.565, 10.568 & 10.569 Criteria Internal controls and other compliance knowledge should prevent the incorrect coding of employee hours worked. Per 2 CFR 200.430(g)(1), "charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed" and "be supported by a system of internal control that provides reasonable assurance that the charges are accurate, allowable and properly allocated." Condition Internal controls and adherence to compliance were not followed with regards to an appropriate level of approval of management that is charged to the Coronavirus State and Local Recovery Funds program and the Food Cluster Program. Questioned costs Total questioned cost of $2,822 based on three payroll transactions tested that were not approved at the appropriate level but were charged to the Coronavirus State and Local Recovery Fund grant (ALN 21.027). Total questioned cost of $3,475 based on three payroll transactions tested that were not approved at the appropriate level but were charged to the Food Cluster Program (ALNs 10.565, 10.568, & 10.569). Context During our payroll testing, of the six executive director timesheets tested, none of them indicated a review or approval from the board president. Cause The error was caused by not applying an adequate number of controls necessary for the executive director's timesheet. Effect The Coronavirus State and Local Recovery Funds program and Food Cluster program and other federal programs could be incorrectly charged with unreasonable wages.Repeat Finding No. Auditor's Recommendation We recommend that the board president or other board member designee review the executive director's timesheet prior to submitting the wages for reimbursement from federal grants.
2024-001 Significant Deficiency in Internal Control and Compliance over Major Programs Funding Agency: Department of Treasury ALN: 21.027 Funding Agency: Department of Agriculture ALNs: 10.565, 10.568 & 10.569 Criteria Internal controls and other compliance knowledge should prevent the incorrect coding of employee hours worked. Per 2 CFR 200.430(g)(1), "charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed" and "be supported by a system of internal control that provides reasonable assurance that the charges are accurate, allowable and properly allocated." Condition Internal controls and adherence to compliance were not followed with regards to an appropriate level of approval of management that is charged to the Coronavirus State and Local Recovery Funds program and the Food Cluster Program. Questioned costs Total questioned cost of $2,822 based on three payroll transactions tested that were not approved at the appropriate level but were charged to the Coronavirus State and Local Recovery Fund grant (ALN 21.027). Total questioned cost of $3,475 based on three payroll transactions tested that were not approved at the appropriate level but were charged to the Food Cluster Program (ALNs 10.565, 10.568, & 10.569). Context During our payroll testing, of the six executive director timesheets tested, none of them indicated a review or approval from the board president. Cause The error was caused by not applying an adequate number of controls necessary for the executive director's timesheet. Effect The Coronavirus State and Local Recovery Funds program and Food Cluster program and other federal programs could be incorrectly charged with unreasonable wages.Repeat Finding No. Auditor's Recommendation We recommend that the board president or other board member designee review the executive director's timesheet prior to submitting the wages for reimbursement from federal grants.
2024-001 Significant Deficiency in Internal Control and Compliance over Major Programs Funding Agency: Department of Treasury ALN: 21.027 Funding Agency: Department of Agriculture ALNs: 10.565, 10.568 & 10.569 Criteria Internal controls and other compliance knowledge should prevent the incorrect coding of employee hours worked. Per 2 CFR 200.430(g)(1), "charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed" and "be supported by a system of internal control that provides reasonable assurance that the charges are accurate, allowable and properly allocated." Condition Internal controls and adherence to compliance were not followed with regards to an appropriate level of approval of management that is charged to the Coronavirus State and Local Recovery Funds program and the Food Cluster Program. Questioned costs Total questioned cost of $2,822 based on three payroll transactions tested that were not approved at the appropriate level but were charged to the Coronavirus State and Local Recovery Fund grant (ALN 21.027). Total questioned cost of $3,475 based on three payroll transactions tested that were not approved at the appropriate level but were charged to the Food Cluster Program (ALNs 10.565, 10.568, & 10.569). Context During our payroll testing, of the six executive director timesheets tested, none of them indicated a review or approval from the board president. Cause The error was caused by not applying an adequate number of controls necessary for the executive director's timesheet. Effect The Coronavirus State and Local Recovery Funds program and Food Cluster program and other federal programs could be incorrectly charged with unreasonable wages.Repeat Finding No. Auditor's Recommendation We recommend that the board president or other board member designee review the executive director's timesheet prior to submitting the wages for reimbursement from federal grants.
2024-001 Significant Deficiency in Internal Control and Compliance over Major Programs Funding Agency: Department of Treasury ALN: 21.027 Funding Agency: Department of Agriculture ALNs: 10.565, 10.568 & 10.569 Criteria Internal controls and other compliance knowledge should prevent the incorrect coding of employee hours worked. Per 2 CFR 200.430(g)(1), "charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed" and "be supported by a system of internal control that provides reasonable assurance that the charges are accurate, allowable and properly allocated." Condition Internal controls and adherence to compliance were not followed with regards to an appropriate level of approval of management that is charged to the Coronavirus State and Local Recovery Funds program and the Food Cluster Program. Questioned costs Total questioned cost of $2,822 based on three payroll transactions tested that were not approved at the appropriate level but were charged to the Coronavirus State and Local Recovery Fund grant (ALN 21.027). Total questioned cost of $3,475 based on three payroll transactions tested that were not approved at the appropriate level but were charged to the Food Cluster Program (ALNs 10.565, 10.568, & 10.569). Context During our payroll testing, of the six executive director timesheets tested, none of them indicated a review or approval from the board president. Cause The error was caused by not applying an adequate number of controls necessary for the executive director's timesheet. Effect The Coronavirus State and Local Recovery Funds program and Food Cluster program and other federal programs could be incorrectly charged with unreasonable wages.Repeat Finding No. Auditor's Recommendation We recommend that the board president or other board member designee review the executive director's timesheet prior to submitting the wages for reimbursement from federal grants.
2024-001 Significant Deficiency in Internal Control and Compliance over Major Programs Funding Agency: Department of Treasury ALN: 21.027 Funding Agency: Department of Agriculture ALNs: 10.565, 10.568 & 10.569 Criteria Internal controls and other compliance knowledge should prevent the incorrect coding of employee hours worked. Per 2 CFR 200.430(g)(1), "charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed" and "be supported by a system of internal control that provides reasonable assurance that the charges are accurate, allowable and properly allocated." Condition Internal controls and adherence to compliance were not followed with regards to an appropriate level of approval of management that is charged to the Coronavirus State and Local Recovery Funds program and the Food Cluster Program. Questioned costs Total questioned cost of $2,822 based on three payroll transactions tested that were not approved at the appropriate level but were charged to the Coronavirus State and Local Recovery Fund grant (ALN 21.027). Total questioned cost of $3,475 based on three payroll transactions tested that were not approved at the appropriate level but were charged to the Food Cluster Program (ALNs 10.565, 10.568, & 10.569). Context During our payroll testing, of the six executive director timesheets tested, none of them indicated a review or approval from the board president. Cause The error was caused by not applying an adequate number of controls necessary for the executive director's timesheet. Effect The Coronavirus State and Local Recovery Funds program and Food Cluster program and other federal programs could be incorrectly charged with unreasonable wages.Repeat Finding No. Auditor's Recommendation We recommend that the board president or other board member designee review the executive director's timesheet prior to submitting the wages for reimbursement from federal grants.
2024-001 Significant Deficiency in Internal Control and Compliance over Major Programs Funding Agency: Department of Treasury ALN: 21.027 Funding Agency: Department of Agriculture ALNs: 10.565, 10.568 & 10.569 Criteria Internal controls and other compliance knowledge should prevent the incorrect coding of employee hours worked. Per 2 CFR 200.430(g)(1), "charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed" and "be supported by a system of internal control that provides reasonable assurance that the charges are accurate, allowable and properly allocated." Condition Internal controls and adherence to compliance were not followed with regards to an appropriate level of approval of management that is charged to the Coronavirus State and Local Recovery Funds program and the Food Cluster Program. Questioned costs Total questioned cost of $2,822 based on three payroll transactions tested that were not approved at the appropriate level but were charged to the Coronavirus State and Local Recovery Fund grant (ALN 21.027). Total questioned cost of $3,475 based on three payroll transactions tested that were not approved at the appropriate level but were charged to the Food Cluster Program (ALNs 10.565, 10.568, & 10.569). Context During our payroll testing, of the six executive director timesheets tested, none of them indicated a review or approval from the board president. Cause The error was caused by not applying an adequate number of controls necessary for the executive director's timesheet. Effect The Coronavirus State and Local Recovery Funds program and Food Cluster program and other federal programs could be incorrectly charged with unreasonable wages.Repeat Finding No. Auditor's Recommendation We recommend that the board president or other board member designee review the executive director's timesheet prior to submitting the wages for reimbursement from federal grants.
2024-001 Significant Deficiency in Internal Control and Compliance over Major Programs Funding Agency: Department of Treasury ALN: 21.027 Funding Agency: Department of Agriculture ALNs: 10.565, 10.568 & 10.569 Criteria Internal controls and other compliance knowledge should prevent the incorrect coding of employee hours worked. Per 2 CFR 200.430(g)(1), "charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed" and "be supported by a system of internal control that provides reasonable assurance that the charges are accurate, allowable and properly allocated." Condition Internal controls and adherence to compliance were not followed with regards to an appropriate level of approval of management that is charged to the Coronavirus State and Local Recovery Funds program and the Food Cluster Program. Questioned costs Total questioned cost of $2,822 based on three payroll transactions tested that were not approved at the appropriate level but were charged to the Coronavirus State and Local Recovery Fund grant (ALN 21.027). Total questioned cost of $3,475 based on three payroll transactions tested that were not approved at the appropriate level but were charged to the Food Cluster Program (ALNs 10.565, 10.568, & 10.569). Context During our payroll testing, of the six executive director timesheets tested, none of them indicated a review or approval from the board president. Cause The error was caused by not applying an adequate number of controls necessary for the executive director's timesheet. Effect The Coronavirus State and Local Recovery Funds program and Food Cluster program and other federal programs could be incorrectly charged with unreasonable wages.Repeat Finding No. Auditor's Recommendation We recommend that the board president or other board member designee review the executive director's timesheet prior to submitting the wages for reimbursement from federal grants.
2024-001 Significant Deficiency in Internal Control and Compliance over Major Programs Funding Agency: Department of Treasury ALN: 21.027 Funding Agency: Department of Agriculture ALNs: 10.565, 10.568 & 10.569 Criteria Internal controls and other compliance knowledge should prevent the incorrect coding of employee hours worked. Per 2 CFR 200.430(g)(1), "charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed" and "be supported by a system of internal control that provides reasonable assurance that the charges are accurate, allowable and properly allocated." Condition Internal controls and adherence to compliance were not followed with regards to an appropriate level of approval of management that is charged to the Coronavirus State and Local Recovery Funds program and the Food Cluster Program. Questioned costs Total questioned cost of $2,822 based on three payroll transactions tested that were not approved at the appropriate level but were charged to the Coronavirus State and Local Recovery Fund grant (ALN 21.027). Total questioned cost of $3,475 based on three payroll transactions tested that were not approved at the appropriate level but were charged to the Food Cluster Program (ALNs 10.565, 10.568, & 10.569). Context During our payroll testing, of the six executive director timesheets tested, none of them indicated a review or approval from the board president. Cause The error was caused by not applying an adequate number of controls necessary for the executive director's timesheet. Effect The Coronavirus State and Local Recovery Funds program and Food Cluster program and other federal programs could be incorrectly charged with unreasonable wages.Repeat Finding No. Auditor's Recommendation We recommend that the board president or other board member designee review the executive director's timesheet prior to submitting the wages for reimbursement from federal grants.
2024-001 Significant Deficiency in Internal Control and Compliance over Major Programs Funding Agency: Department of Treasury ALN: 21.027 Funding Agency: Department of Agriculture ALNs: 10.565, 10.568 & 10.569 Criteria Internal controls and other compliance knowledge should prevent the incorrect coding of employee hours worked. Per 2 CFR 200.430(g)(1), "charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed" and "be supported by a system of internal control that provides reasonable assurance that the charges are accurate, allowable and properly allocated." Condition Internal controls and adherence to compliance were not followed with regards to an appropriate level of approval of management that is charged to the Coronavirus State and Local Recovery Funds program and the Food Cluster Program. Questioned costs Total questioned cost of $2,822 based on three payroll transactions tested that were not approved at the appropriate level but were charged to the Coronavirus State and Local Recovery Fund grant (ALN 21.027). Total questioned cost of $3,475 based on three payroll transactions tested that were not approved at the appropriate level but were charged to the Food Cluster Program (ALNs 10.565, 10.568, & 10.569). Context During our payroll testing, of the six executive director timesheets tested, none of them indicated a review or approval from the board president. Cause The error was caused by not applying an adequate number of controls necessary for the executive director's timesheet. Effect The Coronavirus State and Local Recovery Funds program and Food Cluster program and other federal programs could be incorrectly charged with unreasonable wages.Repeat Finding No. Auditor's Recommendation We recommend that the board president or other board member designee review the executive director's timesheet prior to submitting the wages for reimbursement from federal grants.
2024-001 Significant Deficiency in Internal Control and Compliance over Major Programs Funding Agency: Department of Treasury ALN: 21.027 Funding Agency: Department of Agriculture ALNs: 10.565, 10.568 & 10.569 Criteria Internal controls and other compliance knowledge should prevent the incorrect coding of employee hours worked. Per 2 CFR 200.430(g)(1), "charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed" and "be supported by a system of internal control that provides reasonable assurance that the charges are accurate, allowable and properly allocated." Condition Internal controls and adherence to compliance were not followed with regards to an appropriate level of approval of management that is charged to the Coronavirus State and Local Recovery Funds program and the Food Cluster Program. Questioned costs Total questioned cost of $2,822 based on three payroll transactions tested that were not approved at the appropriate level but were charged to the Coronavirus State and Local Recovery Fund grant (ALN 21.027). Total questioned cost of $3,475 based on three payroll transactions tested that were not approved at the appropriate level but were charged to the Food Cluster Program (ALNs 10.565, 10.568, & 10.569). Context During our payroll testing, of the six executive director timesheets tested, none of them indicated a review or approval from the board president. Cause The error was caused by not applying an adequate number of controls necessary for the executive director's timesheet. Effect The Coronavirus State and Local Recovery Funds program and Food Cluster program and other federal programs could be incorrectly charged with unreasonable wages.Repeat Finding No. Auditor's Recommendation We recommend that the board president or other board member designee review the executive director's timesheet prior to submitting the wages for reimbursement from federal grants.
2024-001 Significant Deficiency in Internal Control and Compliance over Major Programs Funding Agency: Department of Treasury ALN: 21.027 Funding Agency: Department of Agriculture ALNs: 10.565, 10.568 & 10.569 Criteria Internal controls and other compliance knowledge should prevent the incorrect coding of employee hours worked. Per 2 CFR 200.430(g)(1), "charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed" and "be supported by a system of internal control that provides reasonable assurance that the charges are accurate, allowable and properly allocated." Condition Internal controls and adherence to compliance were not followed with regards to an appropriate level of approval of management that is charged to the Coronavirus State and Local Recovery Funds program and the Food Cluster Program. Questioned costs Total questioned cost of $2,822 based on three payroll transactions tested that were not approved at the appropriate level but were charged to the Coronavirus State and Local Recovery Fund grant (ALN 21.027). Total questioned cost of $3,475 based on three payroll transactions tested that were not approved at the appropriate level but were charged to the Food Cluster Program (ALNs 10.565, 10.568, & 10.569). Context During our payroll testing, of the six executive director timesheets tested, none of them indicated a review or approval from the board president. Cause The error was caused by not applying an adequate number of controls necessary for the executive director's timesheet. Effect The Coronavirus State and Local Recovery Funds program and Food Cluster program and other federal programs could be incorrectly charged with unreasonable wages.Repeat Finding No. Auditor's Recommendation We recommend that the board president or other board member designee review the executive director's timesheet prior to submitting the wages for reimbursement from federal grants.
2024-001 Significant Deficiency in Internal Control and Compliance over Major Programs Funding Agency: Department of Treasury ALN: 21.027 Funding Agency: Department of Agriculture ALNs: 10.565, 10.568 & 10.569 Criteria Internal controls and other compliance knowledge should prevent the incorrect coding of employee hours worked. Per 2 CFR 200.430(g)(1), "charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed" and "be supported by a system of internal control that provides reasonable assurance that the charges are accurate, allowable and properly allocated." Condition Internal controls and adherence to compliance were not followed with regards to an appropriate level of approval of management that is charged to the Coronavirus State and Local Recovery Funds program and the Food Cluster Program. Questioned costs Total questioned cost of $2,822 based on three payroll transactions tested that were not approved at the appropriate level but were charged to the Coronavirus State and Local Recovery Fund grant (ALN 21.027). Total questioned cost of $3,475 based on three payroll transactions tested that were not approved at the appropriate level but were charged to the Food Cluster Program (ALNs 10.565, 10.568, & 10.569). Context During our payroll testing, of the six executive director timesheets tested, none of them indicated a review or approval from the board president. Cause The error was caused by not applying an adequate number of controls necessary for the executive director's timesheet. Effect The Coronavirus State and Local Recovery Funds program and Food Cluster program and other federal programs could be incorrectly charged with unreasonable wages.Repeat Finding No. Auditor's Recommendation We recommend that the board president or other board member designee review the executive director's timesheet prior to submitting the wages for reimbursement from federal grants.
2024-001 Significant Deficiency in Internal Control and Compliance over Major Programs Funding Agency: Department of Treasury ALN: 21.027 Funding Agency: Department of Agriculture ALNs: 10.565, 10.568 & 10.569 Criteria Internal controls and other compliance knowledge should prevent the incorrect coding of employee hours worked. Per 2 CFR 200.430(g)(1), "charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed" and "be supported by a system of internal control that provides reasonable assurance that the charges are accurate, allowable and properly allocated." Condition Internal controls and adherence to compliance were not followed with regards to an appropriate level of approval of management that is charged to the Coronavirus State and Local Recovery Funds program and the Food Cluster Program. Questioned costs Total questioned cost of $2,822 based on three payroll transactions tested that were not approved at the appropriate level but were charged to the Coronavirus State and Local Recovery Fund grant (ALN 21.027). Total questioned cost of $3,475 based on three payroll transactions tested that were not approved at the appropriate level but were charged to the Food Cluster Program (ALNs 10.565, 10.568, & 10.569). Context During our payroll testing, of the six executive director timesheets tested, none of them indicated a review or approval from the board president. Cause The error was caused by not applying an adequate number of controls necessary for the executive director's timesheet. Effect The Coronavirus State and Local Recovery Funds program and Food Cluster program and other federal programs could be incorrectly charged with unreasonable wages.Repeat Finding No. Auditor's Recommendation We recommend that the board president or other board member designee review the executive director's timesheet prior to submitting the wages for reimbursement from federal grants.