Finding 2024-001 (Considered a significant deficiency in control compliance for allowable costs and activities) Federal Agency: United Stated Department of Health and Human Services Assistance Listing Numbers: 93.558, 17.258, 17.259, 17.278 Criteria: The Code of Federal Regulations (CFR), particularly 2 CFR § 200.430 (Compensation - Personal Services), requires that charges to federal awards for personnel costs must be based on accurate timekeeping records, and that those records should be properly mapped and reviewed to ensure costs are correctly allocated. Federal award recipients must have sufficient internal controls in place to ensure accurate billing to grants and proper review of payroll data, including verifying the proper mapping of timesheets to funding sources. Condition: For 2 out of 25 transactions for Temporary Assistance for Needy Families and 1 out of 25 transactions for Work Innovation and Opportunity Act Cluster, time reported by a sample of employees on their timesheets for work performed on the grant was not accurately mapped when imported into the payroll system. Specifically, the timesheets showed the amount of time employees spent working on the federal grant, but when this data was entered into the payroll system for processing, it was incorrectly allocated across other funding sources. Cause: The misallocation of time was caused by a failure in the internal controls related to the mapping process between timesheets and the payroll system. Specifically, the integration process between the timesheet reporting system and the payroll system did not correctly map time worked on federal grants to the appropriate funding sources. This error was not identified by the Organization's internal review controls. Effect: As a result of the mapping error, the Organization charged excess costs to the federal grant, leading to overbilling for labor costs. Questioned Costs: Known - $173. Recommendation: The Organization should review and adjust the mapping process between timesheet data and the payroll system to ensure that time worked on the federal grant is properly allocated. This may include updating software interfaces or implementing manual checks to ensure correct mapping. Management's View: The Organization concurs with the facts of this finding and is implementing procedures to prevent this in the future.
Finding 2024-001 (Considered a significant deficiency in control compliance for allowable costs and activities) Federal Agency: United Stated Department of Health and Human Services Assistance Listing Numbers: 93.558, 17.258, 17.259, 17.278 Criteria: The Code of Federal Regulations (CFR), particularly 2 CFR § 200.430 (Compensation - Personal Services), requires that charges to federal awards for personnel costs must be based on accurate timekeeping records, and that those records should be properly mapped and reviewed to ensure costs are correctly allocated. Federal award recipients must have sufficient internal controls in place to ensure accurate billing to grants and proper review of payroll data, including verifying the proper mapping of timesheets to funding sources. Condition: For 2 out of 25 transactions for Temporary Assistance for Needy Families and 1 out of 25 transactions for Work Innovation and Opportunity Act Cluster, time reported by a sample of employees on their timesheets for work performed on the grant was not accurately mapped when imported into the payroll system. Specifically, the timesheets showed the amount of time employees spent working on the federal grant, but when this data was entered into the payroll system for processing, it was incorrectly allocated across other funding sources. Cause: The misallocation of time was caused by a failure in the internal controls related to the mapping process between timesheets and the payroll system. Specifically, the integration process between the timesheet reporting system and the payroll system did not correctly map time worked on federal grants to the appropriate funding sources. This error was not identified by the Organization's internal review controls. Effect: As a result of the mapping error, the Organization charged excess costs to the federal grant, leading to overbilling for labor costs. Questioned Costs: Known - $173. Recommendation: The Organization should review and adjust the mapping process between timesheet data and the payroll system to ensure that time worked on the federal grant is properly allocated. This may include updating software interfaces or implementing manual checks to ensure correct mapping. Management's View: The Organization concurs with the facts of this finding and is implementing procedures to prevent this in the future.
Finding 2024-001 (Considered a significant deficiency in control compliance for allowable costs and activities) Federal Agency: United Stated Department of Health and Human Services Assistance Listing Numbers: 93.558, 17.258, 17.259, 17.278 Criteria: The Code of Federal Regulations (CFR), particularly 2 CFR § 200.430 (Compensation - Personal Services), requires that charges to federal awards for personnel costs must be based on accurate timekeeping records, and that those records should be properly mapped and reviewed to ensure costs are correctly allocated. Federal award recipients must have sufficient internal controls in place to ensure accurate billing to grants and proper review of payroll data, including verifying the proper mapping of timesheets to funding sources. Condition: For 2 out of 25 transactions for Temporary Assistance for Needy Families and 1 out of 25 transactions for Work Innovation and Opportunity Act Cluster, time reported by a sample of employees on their timesheets for work performed on the grant was not accurately mapped when imported into the payroll system. Specifically, the timesheets showed the amount of time employees spent working on the federal grant, but when this data was entered into the payroll system for processing, it was incorrectly allocated across other funding sources. Cause: The misallocation of time was caused by a failure in the internal controls related to the mapping process between timesheets and the payroll system. Specifically, the integration process between the timesheet reporting system and the payroll system did not correctly map time worked on federal grants to the appropriate funding sources. This error was not identified by the Organization's internal review controls. Effect: As a result of the mapping error, the Organization charged excess costs to the federal grant, leading to overbilling for labor costs. Questioned Costs: Known - $173. Recommendation: The Organization should review and adjust the mapping process between timesheet data and the payroll system to ensure that time worked on the federal grant is properly allocated. This may include updating software interfaces or implementing manual checks to ensure correct mapping. Management's View: The Organization concurs with the facts of this finding and is implementing procedures to prevent this in the future.
Finding 2024-001 (Considered a significant deficiency in control compliance for allowable costs and activities) Federal Agency: United Stated Department of Health and Human Services Assistance Listing Numbers: 93.558, 17.258, 17.259, 17.278 Criteria: The Code of Federal Regulations (CFR), particularly 2 CFR § 200.430 (Compensation - Personal Services), requires that charges to federal awards for personnel costs must be based on accurate timekeeping records, and that those records should be properly mapped and reviewed to ensure costs are correctly allocated. Federal award recipients must have sufficient internal controls in place to ensure accurate billing to grants and proper review of payroll data, including verifying the proper mapping of timesheets to funding sources. Condition: For 2 out of 25 transactions for Temporary Assistance for Needy Families and 1 out of 25 transactions for Work Innovation and Opportunity Act Cluster, time reported by a sample of employees on their timesheets for work performed on the grant was not accurately mapped when imported into the payroll system. Specifically, the timesheets showed the amount of time employees spent working on the federal grant, but when this data was entered into the payroll system for processing, it was incorrectly allocated across other funding sources. Cause: The misallocation of time was caused by a failure in the internal controls related to the mapping process between timesheets and the payroll system. Specifically, the integration process between the timesheet reporting system and the payroll system did not correctly map time worked on federal grants to the appropriate funding sources. This error was not identified by the Organization's internal review controls. Effect: As a result of the mapping error, the Organization charged excess costs to the federal grant, leading to overbilling for labor costs. Questioned Costs: Known - $173. Recommendation: The Organization should review and adjust the mapping process between timesheet data and the payroll system to ensure that time worked on the federal grant is properly allocated. This may include updating software interfaces or implementing manual checks to ensure correct mapping. Management's View: The Organization concurs with the facts of this finding and is implementing procedures to prevent this in the future.
Finding 2024-001 (Considered a significant deficiency in control compliance for allowable costs and activities) Federal Agency: United Stated Department of Health and Human Services Assistance Listing Numbers: 93.558, 17.258, 17.259, 17.278 Criteria: The Code of Federal Regulations (CFR), particularly 2 CFR § 200.430 (Compensation - Personal Services), requires that charges to federal awards for personnel costs must be based on accurate timekeeping records, and that those records should be properly mapped and reviewed to ensure costs are correctly allocated. Federal award recipients must have sufficient internal controls in place to ensure accurate billing to grants and proper review of payroll data, including verifying the proper mapping of timesheets to funding sources. Condition: For 2 out of 25 transactions for Temporary Assistance for Needy Families and 1 out of 25 transactions for Work Innovation and Opportunity Act Cluster, time reported by a sample of employees on their timesheets for work performed on the grant was not accurately mapped when imported into the payroll system. Specifically, the timesheets showed the amount of time employees spent working on the federal grant, but when this data was entered into the payroll system for processing, it was incorrectly allocated across other funding sources. Cause: The misallocation of time was caused by a failure in the internal controls related to the mapping process between timesheets and the payroll system. Specifically, the integration process between the timesheet reporting system and the payroll system did not correctly map time worked on federal grants to the appropriate funding sources. This error was not identified by the Organization's internal review controls. Effect: As a result of the mapping error, the Organization charged excess costs to the federal grant, leading to overbilling for labor costs. Questioned Costs: Known - $173. Recommendation: The Organization should review and adjust the mapping process between timesheet data and the payroll system to ensure that time worked on the federal grant is properly allocated. This may include updating software interfaces or implementing manual checks to ensure correct mapping. Management's View: The Organization concurs with the facts of this finding and is implementing procedures to prevent this in the future.
Finding 2024-001 (Considered a significant deficiency in control compliance for allowable costs and activities) Federal Agency: United Stated Department of Health and Human Services Assistance Listing Numbers: 93.558, 17.258, 17.259, 17.278 Criteria: The Code of Federal Regulations (CFR), particularly 2 CFR § 200.430 (Compensation - Personal Services), requires that charges to federal awards for personnel costs must be based on accurate timekeeping records, and that those records should be properly mapped and reviewed to ensure costs are correctly allocated. Federal award recipients must have sufficient internal controls in place to ensure accurate billing to grants and proper review of payroll data, including verifying the proper mapping of timesheets to funding sources. Condition: For 2 out of 25 transactions for Temporary Assistance for Needy Families and 1 out of 25 transactions for Work Innovation and Opportunity Act Cluster, time reported by a sample of employees on their timesheets for work performed on the grant was not accurately mapped when imported into the payroll system. Specifically, the timesheets showed the amount of time employees spent working on the federal grant, but when this data was entered into the payroll system for processing, it was incorrectly allocated across other funding sources. Cause: The misallocation of time was caused by a failure in the internal controls related to the mapping process between timesheets and the payroll system. Specifically, the integration process between the timesheet reporting system and the payroll system did not correctly map time worked on federal grants to the appropriate funding sources. This error was not identified by the Organization's internal review controls. Effect: As a result of the mapping error, the Organization charged excess costs to the federal grant, leading to overbilling for labor costs. Questioned Costs: Known - $173. Recommendation: The Organization should review and adjust the mapping process between timesheet data and the payroll system to ensure that time worked on the federal grant is properly allocated. This may include updating software interfaces or implementing manual checks to ensure correct mapping. Management's View: The Organization concurs with the facts of this finding and is implementing procedures to prevent this in the future.
Finding 2024-001 (Considered a significant deficiency in control compliance for allowable costs and activities) Federal Agency: United Stated Department of Health and Human Services Assistance Listing Numbers: 93.558, 17.258, 17.259, 17.278 Criteria: The Code of Federal Regulations (CFR), particularly 2 CFR § 200.430 (Compensation - Personal Services), requires that charges to federal awards for personnel costs must be based on accurate timekeeping records, and that those records should be properly mapped and reviewed to ensure costs are correctly allocated. Federal award recipients must have sufficient internal controls in place to ensure accurate billing to grants and proper review of payroll data, including verifying the proper mapping of timesheets to funding sources. Condition: For 2 out of 25 transactions for Temporary Assistance for Needy Families and 1 out of 25 transactions for Work Innovation and Opportunity Act Cluster, time reported by a sample of employees on their timesheets for work performed on the grant was not accurately mapped when imported into the payroll system. Specifically, the timesheets showed the amount of time employees spent working on the federal grant, but when this data was entered into the payroll system for processing, it was incorrectly allocated across other funding sources. Cause: The misallocation of time was caused by a failure in the internal controls related to the mapping process between timesheets and the payroll system. Specifically, the integration process between the timesheet reporting system and the payroll system did not correctly map time worked on federal grants to the appropriate funding sources. This error was not identified by the Organization's internal review controls. Effect: As a result of the mapping error, the Organization charged excess costs to the federal grant, leading to overbilling for labor costs. Questioned Costs: Known - $173. Recommendation: The Organization should review and adjust the mapping process between timesheet data and the payroll system to ensure that time worked on the federal grant is properly allocated. This may include updating software interfaces or implementing manual checks to ensure correct mapping. Management's View: The Organization concurs with the facts of this finding and is implementing procedures to prevent this in the future.
Finding 2024-001 (Considered a significant deficiency in control compliance for allowable costs and activities) Federal Agency: United Stated Department of Health and Human Services Assistance Listing Numbers: 93.558, 17.258, 17.259, 17.278 Criteria: The Code of Federal Regulations (CFR), particularly 2 CFR § 200.430 (Compensation - Personal Services), requires that charges to federal awards for personnel costs must be based on accurate timekeeping records, and that those records should be properly mapped and reviewed to ensure costs are correctly allocated. Federal award recipients must have sufficient internal controls in place to ensure accurate billing to grants and proper review of payroll data, including verifying the proper mapping of timesheets to funding sources. Condition: For 2 out of 25 transactions for Temporary Assistance for Needy Families and 1 out of 25 transactions for Work Innovation and Opportunity Act Cluster, time reported by a sample of employees on their timesheets for work performed on the grant was not accurately mapped when imported into the payroll system. Specifically, the timesheets showed the amount of time employees spent working on the federal grant, but when this data was entered into the payroll system for processing, it was incorrectly allocated across other funding sources. Cause: The misallocation of time was caused by a failure in the internal controls related to the mapping process between timesheets and the payroll system. Specifically, the integration process between the timesheet reporting system and the payroll system did not correctly map time worked on federal grants to the appropriate funding sources. This error was not identified by the Organization's internal review controls. Effect: As a result of the mapping error, the Organization charged excess costs to the federal grant, leading to overbilling for labor costs. Questioned Costs: Known - $173. Recommendation: The Organization should review and adjust the mapping process between timesheet data and the payroll system to ensure that time worked on the federal grant is properly allocated. This may include updating software interfaces or implementing manual checks to ensure correct mapping. Management's View: The Organization concurs with the facts of this finding and is implementing procedures to prevent this in the future.
Finding 2024-001 (Considered a significant deficiency in control compliance for allowable costs and activities) Federal Agency: United Stated Department of Health and Human Services Assistance Listing Numbers: 93.558, 17.258, 17.259, 17.278 Criteria: The Code of Federal Regulations (CFR), particularly 2 CFR § 200.430 (Compensation - Personal Services), requires that charges to federal awards for personnel costs must be based on accurate timekeeping records, and that those records should be properly mapped and reviewed to ensure costs are correctly allocated. Federal award recipients must have sufficient internal controls in place to ensure accurate billing to grants and proper review of payroll data, including verifying the proper mapping of timesheets to funding sources. Condition: For 2 out of 25 transactions for Temporary Assistance for Needy Families and 1 out of 25 transactions for Work Innovation and Opportunity Act Cluster, time reported by a sample of employees on their timesheets for work performed on the grant was not accurately mapped when imported into the payroll system. Specifically, the timesheets showed the amount of time employees spent working on the federal grant, but when this data was entered into the payroll system for processing, it was incorrectly allocated across other funding sources. Cause: The misallocation of time was caused by a failure in the internal controls related to the mapping process between timesheets and the payroll system. Specifically, the integration process between the timesheet reporting system and the payroll system did not correctly map time worked on federal grants to the appropriate funding sources. This error was not identified by the Organization's internal review controls. Effect: As a result of the mapping error, the Organization charged excess costs to the federal grant, leading to overbilling for labor costs. Questioned Costs: Known - $173. Recommendation: The Organization should review and adjust the mapping process between timesheet data and the payroll system to ensure that time worked on the federal grant is properly allocated. This may include updating software interfaces or implementing manual checks to ensure correct mapping. Management's View: The Organization concurs with the facts of this finding and is implementing procedures to prevent this in the future.
Finding 2024-001 (Considered a significant deficiency in control compliance for allowable costs and activities) Federal Agency: United Stated Department of Health and Human Services Assistance Listing Numbers: 93.558, 17.258, 17.259, 17.278 Criteria: The Code of Federal Regulations (CFR), particularly 2 CFR § 200.430 (Compensation - Personal Services), requires that charges to federal awards for personnel costs must be based on accurate timekeeping records, and that those records should be properly mapped and reviewed to ensure costs are correctly allocated. Federal award recipients must have sufficient internal controls in place to ensure accurate billing to grants and proper review of payroll data, including verifying the proper mapping of timesheets to funding sources. Condition: For 2 out of 25 transactions for Temporary Assistance for Needy Families and 1 out of 25 transactions for Work Innovation and Opportunity Act Cluster, time reported by a sample of employees on their timesheets for work performed on the grant was not accurately mapped when imported into the payroll system. Specifically, the timesheets showed the amount of time employees spent working on the federal grant, but when this data was entered into the payroll system for processing, it was incorrectly allocated across other funding sources. Cause: The misallocation of time was caused by a failure in the internal controls related to the mapping process between timesheets and the payroll system. Specifically, the integration process between the timesheet reporting system and the payroll system did not correctly map time worked on federal grants to the appropriate funding sources. This error was not identified by the Organization's internal review controls. Effect: As a result of the mapping error, the Organization charged excess costs to the federal grant, leading to overbilling for labor costs. Questioned Costs: Known - $173. Recommendation: The Organization should review and adjust the mapping process between timesheet data and the payroll system to ensure that time worked on the federal grant is properly allocated. This may include updating software interfaces or implementing manual checks to ensure correct mapping. Management's View: The Organization concurs with the facts of this finding and is implementing procedures to prevent this in the future.
Finding 2024-001 (Considered a significant deficiency in control compliance for allowable costs and activities) Federal Agency: United Stated Department of Health and Human Services Assistance Listing Numbers: 93.558, 17.258, 17.259, 17.278 Criteria: The Code of Federal Regulations (CFR), particularly 2 CFR § 200.430 (Compensation - Personal Services), requires that charges to federal awards for personnel costs must be based on accurate timekeeping records, and that those records should be properly mapped and reviewed to ensure costs are correctly allocated. Federal award recipients must have sufficient internal controls in place to ensure accurate billing to grants and proper review of payroll data, including verifying the proper mapping of timesheets to funding sources. Condition: For 2 out of 25 transactions for Temporary Assistance for Needy Families and 1 out of 25 transactions for Work Innovation and Opportunity Act Cluster, time reported by a sample of employees on their timesheets for work performed on the grant was not accurately mapped when imported into the payroll system. Specifically, the timesheets showed the amount of time employees spent working on the federal grant, but when this data was entered into the payroll system for processing, it was incorrectly allocated across other funding sources. Cause: The misallocation of time was caused by a failure in the internal controls related to the mapping process between timesheets and the payroll system. Specifically, the integration process between the timesheet reporting system and the payroll system did not correctly map time worked on federal grants to the appropriate funding sources. This error was not identified by the Organization's internal review controls. Effect: As a result of the mapping error, the Organization charged excess costs to the federal grant, leading to overbilling for labor costs. Questioned Costs: Known - $173. Recommendation: The Organization should review and adjust the mapping process between timesheet data and the payroll system to ensure that time worked on the federal grant is properly allocated. This may include updating software interfaces or implementing manual checks to ensure correct mapping. Management's View: The Organization concurs with the facts of this finding and is implementing procedures to prevent this in the future.
Finding 2024-001 (Considered a significant deficiency in control compliance for allowable costs and activities) Federal Agency: United Stated Department of Health and Human Services Assistance Listing Numbers: 93.558, 17.258, 17.259, 17.278 Criteria: The Code of Federal Regulations (CFR), particularly 2 CFR § 200.430 (Compensation - Personal Services), requires that charges to federal awards for personnel costs must be based on accurate timekeeping records, and that those records should be properly mapped and reviewed to ensure costs are correctly allocated. Federal award recipients must have sufficient internal controls in place to ensure accurate billing to grants and proper review of payroll data, including verifying the proper mapping of timesheets to funding sources. Condition: For 2 out of 25 transactions for Temporary Assistance for Needy Families and 1 out of 25 transactions for Work Innovation and Opportunity Act Cluster, time reported by a sample of employees on their timesheets for work performed on the grant was not accurately mapped when imported into the payroll system. Specifically, the timesheets showed the amount of time employees spent working on the federal grant, but when this data was entered into the payroll system for processing, it was incorrectly allocated across other funding sources. Cause: The misallocation of time was caused by a failure in the internal controls related to the mapping process between timesheets and the payroll system. Specifically, the integration process between the timesheet reporting system and the payroll system did not correctly map time worked on federal grants to the appropriate funding sources. This error was not identified by the Organization's internal review controls. Effect: As a result of the mapping error, the Organization charged excess costs to the federal grant, leading to overbilling for labor costs. Questioned Costs: Known - $173. Recommendation: The Organization should review and adjust the mapping process between timesheet data and the payroll system to ensure that time worked on the federal grant is properly allocated. This may include updating software interfaces or implementing manual checks to ensure correct mapping. Management's View: The Organization concurs with the facts of this finding and is implementing procedures to prevent this in the future.
Finding 2024-001 (Considered a significant deficiency in control compliance for allowable costs and activities) Federal Agency: United Stated Department of Health and Human Services Assistance Listing Numbers: 93.558, 17.258, 17.259, 17.278 Criteria: The Code of Federal Regulations (CFR), particularly 2 CFR § 200.430 (Compensation - Personal Services), requires that charges to federal awards for personnel costs must be based on accurate timekeeping records, and that those records should be properly mapped and reviewed to ensure costs are correctly allocated. Federal award recipients must have sufficient internal controls in place to ensure accurate billing to grants and proper review of payroll data, including verifying the proper mapping of timesheets to funding sources. Condition: For 2 out of 25 transactions for Temporary Assistance for Needy Families and 1 out of 25 transactions for Work Innovation and Opportunity Act Cluster, time reported by a sample of employees on their timesheets for work performed on the grant was not accurately mapped when imported into the payroll system. Specifically, the timesheets showed the amount of time employees spent working on the federal grant, but when this data was entered into the payroll system for processing, it was incorrectly allocated across other funding sources. Cause: The misallocation of time was caused by a failure in the internal controls related to the mapping process between timesheets and the payroll system. Specifically, the integration process between the timesheet reporting system and the payroll system did not correctly map time worked on federal grants to the appropriate funding sources. This error was not identified by the Organization's internal review controls. Effect: As a result of the mapping error, the Organization charged excess costs to the federal grant, leading to overbilling for labor costs. Questioned Costs: Known - $173. Recommendation: The Organization should review and adjust the mapping process between timesheet data and the payroll system to ensure that time worked on the federal grant is properly allocated. This may include updating software interfaces or implementing manual checks to ensure correct mapping. Management's View: The Organization concurs with the facts of this finding and is implementing procedures to prevent this in the future.
Finding 2024-001 (Considered a significant deficiency in control compliance for allowable costs and activities) Federal Agency: United Stated Department of Health and Human Services Assistance Listing Numbers: 93.558, 17.258, 17.259, 17.278 Criteria: The Code of Federal Regulations (CFR), particularly 2 CFR § 200.430 (Compensation - Personal Services), requires that charges to federal awards for personnel costs must be based on accurate timekeeping records, and that those records should be properly mapped and reviewed to ensure costs are correctly allocated. Federal award recipients must have sufficient internal controls in place to ensure accurate billing to grants and proper review of payroll data, including verifying the proper mapping of timesheets to funding sources. Condition: For 2 out of 25 transactions for Temporary Assistance for Needy Families and 1 out of 25 transactions for Work Innovation and Opportunity Act Cluster, time reported by a sample of employees on their timesheets for work performed on the grant was not accurately mapped when imported into the payroll system. Specifically, the timesheets showed the amount of time employees spent working on the federal grant, but when this data was entered into the payroll system for processing, it was incorrectly allocated across other funding sources. Cause: The misallocation of time was caused by a failure in the internal controls related to the mapping process between timesheets and the payroll system. Specifically, the integration process between the timesheet reporting system and the payroll system did not correctly map time worked on federal grants to the appropriate funding sources. This error was not identified by the Organization's internal review controls. Effect: As a result of the mapping error, the Organization charged excess costs to the federal grant, leading to overbilling for labor costs. Questioned Costs: Known - $173. Recommendation: The Organization should review and adjust the mapping process between timesheet data and the payroll system to ensure that time worked on the federal grant is properly allocated. This may include updating software interfaces or implementing manual checks to ensure correct mapping. Management's View: The Organization concurs with the facts of this finding and is implementing procedures to prevent this in the future.
Finding 2024-001 (Considered a significant deficiency in control compliance for allowable costs and activities) Federal Agency: United Stated Department of Health and Human Services Assistance Listing Numbers: 93.558, 17.258, 17.259, 17.278 Criteria: The Code of Federal Regulations (CFR), particularly 2 CFR § 200.430 (Compensation - Personal Services), requires that charges to federal awards for personnel costs must be based on accurate timekeeping records, and that those records should be properly mapped and reviewed to ensure costs are correctly allocated. Federal award recipients must have sufficient internal controls in place to ensure accurate billing to grants and proper review of payroll data, including verifying the proper mapping of timesheets to funding sources. Condition: For 2 out of 25 transactions for Temporary Assistance for Needy Families and 1 out of 25 transactions for Work Innovation and Opportunity Act Cluster, time reported by a sample of employees on their timesheets for work performed on the grant was not accurately mapped when imported into the payroll system. Specifically, the timesheets showed the amount of time employees spent working on the federal grant, but when this data was entered into the payroll system for processing, it was incorrectly allocated across other funding sources. Cause: The misallocation of time was caused by a failure in the internal controls related to the mapping process between timesheets and the payroll system. Specifically, the integration process between the timesheet reporting system and the payroll system did not correctly map time worked on federal grants to the appropriate funding sources. This error was not identified by the Organization's internal review controls. Effect: As a result of the mapping error, the Organization charged excess costs to the federal grant, leading to overbilling for labor costs. Questioned Costs: Known - $173. Recommendation: The Organization should review and adjust the mapping process between timesheet data and the payroll system to ensure that time worked on the federal grant is properly allocated. This may include updating software interfaces or implementing manual checks to ensure correct mapping. Management's View: The Organization concurs with the facts of this finding and is implementing procedures to prevent this in the future.
Finding 2024-003: Allowable Costs/Cost Principles—Payroll Calculation Errors—Significant Deficiency in Controls over Compliance and Noncompliance Federal Program: Coronavirus State and Local Fiscal Recovery Funds—ALN 21.027 Year(s): 2024 Federal Agency: U.S. Department of Treasury Contract—DHA SA-01-22/A2 Pass-Through Entity: Sacramento County Criteria—In accordance with 2 CFR 200.430 (g)(1) and (g)(1)(i) charges to Federal awards for salaries and wages must be based on accurate records and calculations. Condition/Context—Out of 31 payroll selections, 6 selections had calculation errors. In the process of recording the payroll cost for the grant, spreadsheet related errors were made in transferring the general ledger data into the reimbursement requests which were then used to populate the schedule of federal awards of expenditures. Questions Costs—Under the reportable threshold, hence not applicable Cause—The control to review the recording of the payroll general ledger details into the reimbursement request was not precise enough to identify the calculation errors. Effect—Incorrect cost can be charged to the grant which can lead to the potential disallowance of costs. Recommendation—We recommend the Division implement a more detailed and precise review process to ensure the accuracy and completeness of the reimbursement request. Views of the Responsible Officials—See Corrective Action Plan
Federal Agency: Department of Health and Human Services Federal Program Name: Substance Abuse and Mental Health Services Projects of Regional and National Significance Assistance Listing Number: 93.243 Federal Award Identification Number and Year: 1H79SM087513-01 - 2024 Award Period: September 30, 2023 through September 29, 2027 Type of Finding: • Significant Deficiency in Internal Control over Compliance Criteria or specific requirement: According to the grant agreement and 2 CFR 200.430(g), charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. In additions, according to 2 CFR 200.430(g)(1)(vii), budget estimates alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that the system for establishing the estimates produces reasonable approximations of activity performed, significant changes in work activity are promptly identified and entered into the records, and the recipient’s system of internal controls includes processes to perform periodic after-the-fact reviews of interim charges made to a Federal awards based on budget estimates. All necessary adjustments must be made so that the final amount charges to the Federal award is accurate, allowable, and properly allocated. Condition: During our review of the grant expenditures, it was noted that budgeted amounts were charged to the grant instead of the actual costs incurred. This practice was observed in multiple instances, leading to discrepancies between the reported expenditures and the actual costs. Management did not review time and effort to make after-the-fact adjustments to the amounts charged to the grant. Questioned costs: None Context: The Organization had generally spent more than was funded for salaries and benefits under federal grants or would have expenses that would not be reimbursable under the program. Due to the actual salary amount expended exceeded the total grant budgeted amount, the Organization only charged the monthly budgeted amount instead of the actual amount expended. Cause: The incorrect charging of budgeted amounts instead of actual costs appears to be due to a lack of proper oversight and understanding of the grant requirements by the personnel responsible for financial reporting and grant management. Effect: Charging budgeted amounts instead of actual costs can result in non-compliance with grant requirements, potential disallowance of costs, and inaccurate financial reporting. This could also lead to financial penalties and affect the organization's ability to secure future funding. Recommendation: We recommend that the Organization establish a review process to ensure that all costs charged to the grant are based on actual expenditures and are properly documented. Views of responsible officials: There is no disagreement with the audit finding.
2024-001 – Child Support Services - Unallowable Costs Finding Type: Significant deficiency in internal controls and immaterial noncompliance Criteria: Per 2 CFR § 200.303 (Internal Controls), non-federal entities must establish and maintain effective internal controls over federal awards that provide reasonable assurance of compliance with federal statutes, regulations, and the terms and conditions of the award. Additionally, 2 CFR § 200.430 (Compensation—Personal Services) requires that payroll costs charged to federal awards must be based on records that accurately reflect the work performed and be supported by adequate documentation. Condition/Finding: During our audit of Manistee County’s Child Support Services federal grant expenditures, it was determined that the County lacked effectively operating controls to ensure that salary and wage expenses charged to the Child Support Services program were allowable and properly allocated. Cause: The County’s internal controls were not adequately designed or implemented to ensure compliance with federal grant requirements. Effect: As a result, the County received an overpayment of federal funds of $5,528.41 during FY 2024. Recommendation: We recommend that the County take actions to strengthen internal controls over payroll expenditures related to federal grants to ensure compliance with federal cost principles and proper expense allocation. View of Responsible Officials (Corrective Action): See corrective action plan.
2024-001 – Child Support Services - Unallowable Costs Finding Type: Significant deficiency in internal controls and immaterial noncompliance Criteria: Per 2 CFR § 200.303 (Internal Controls), non-federal entities must establish and maintain effective internal controls over federal awards that provide reasonable assurance of compliance with federal statutes, regulations, and the terms and conditions of the award. Additionally, 2 CFR § 200.430 (Compensation—Personal Services) requires that payroll costs charged to federal awards must be based on records that accurately reflect the work performed and be supported by adequate documentation. Condition/Finding: During our audit of Manistee County’s Child Support Services federal grant expenditures, it was determined that the County lacked effectively operating controls to ensure that salary and wage expenses charged to the Child Support Services program were allowable and properly allocated. Cause: The County’s internal controls were not adequately designed or implemented to ensure compliance with federal grant requirements. Effect: As a result, the County received an overpayment of federal funds of $5,528.41 during FY 2024. Recommendation: We recommend that the County take actions to strengthen internal controls over payroll expenditures related to federal grants to ensure compliance with federal cost principles and proper expense allocation. View of Responsible Officials (Corrective Action): See corrective action plan.
Finding 2024-002 – Allowable costs – payroll Assistance Listing #: 93.243 Criteria: In accordance with the Uniform Guidance’s compensation requirements (2 CFR 200.430), payroll systems must be based on records that accurately reflect the work performed and supported by a system of internal controls that provides reasonable assurances that charges are accurate; allowable and reasonable; and properly allocated. The Uniform Guidance allows for use of budget estimates on an interim basis. When using budget estimates on an interim basis, grantees must reconcile estimates against actual time or effort on a regular basis to ensure that estimates conform to actual staff activity. Grantees must make adjustments in the payroll distribution to align with actual time. Condition: During fiscal year 2024, the Organization charged payroll costs to the federal award programs using a set percentage based on budget and not based on employee’s actual time or effort amongst various programs. Cause: Management was made aware that using budget estimates was not allowed without further reconciliation against actual time or effort activities during the fiscal year 2022 audit which was completed in April 2024. Management has not yet implemented changes to its internal processes to address the identified issue. Effect: The salary costs charged to the federal programs may have been under or over reported based on the actual level of effort. Questioned Costs: N/A Repeat Finding: Yes Recommendation: We recommend the Organization make changes overall its timekeeping processes to ensure that payroll costs accurately reflect the work performed and if budget estimates are utilized, that they are reconciled and trued up on a consistent basis. Response: The Organization is acting upon different guidance it has received. As of the date this audit is released, the contract this finding addresses is currently scheduled to end on 08/30/2025. NFFCMH will continue our current practice through the end of the current contract, and will review any potential change to same with any renewal of this contract.
Finding 2024-002 – Allowable costs – payroll Assistance Listing #: 93.243 Criteria: In accordance with the Uniform Guidance’s compensation requirements (2 CFR 200.430), payroll systems must be based on records that accurately reflect the work performed and supported by a system of internal controls that provides reasonable assurances that charges are accurate; allowable and reasonable; and properly allocated. The Uniform Guidance allows for use of budget estimates on an interim basis. When using budget estimates on an interim basis, grantees must reconcile estimates against actual time or effort on a regular basis to ensure that estimates conform to actual staff activity. Grantees must make adjustments in the payroll distribution to align with actual time. Condition: During fiscal year 2024, the Organization charged payroll costs to the federal award programs using a set percentage based on budget and not based on employee’s actual time or effort amongst various programs. Cause: Management was made aware that using budget estimates was not allowed without further reconciliation against actual time or effort activities during the fiscal year 2022 audit which was completed in April 2024. Management has not yet implemented changes to its internal processes to address the identified issue. Effect: The salary costs charged to the federal programs may have been under or over reported based on the actual level of effort. Questioned Costs: N/A Repeat Finding: Yes Recommendation: We recommend the Organization make changes overall its timekeeping processes to ensure that payroll costs accurately reflect the work performed and if budget estimates are utilized, that they are reconciled and trued up on a consistent basis. Response: The Organization is acting upon different guidance it has received. As of the date this audit is released, the contract this finding addresses is currently scheduled to end on 08/30/2025. NFFCMH will continue our current practice through the end of the current contract, and will review any potential change to same with any renewal of this contract.
Finding Number: 2024-034 Prior Year Finding Number: N/A Compliance Requirement: Activities Allowed or Unallowed and Allowable Costs/Cost Principles Program: U.S. Department of Health and Human Services Block Grants for Substance Use Prevention, Treatment, and Recovery Services ALN: 93.959 Award #: Various Award Years: 10/01/2022 – 09/30/2024; 03/15/2021 – 03/14/2025 Government Department/Agency: Department of Behavioral Health (DBH) Criteria - The Uniform Guidance in 2 CFR Section 200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Per 2 CFR Section 200.430 Compensation – Personal Services: “Costs of compensation are allowable to the extent that they satisfy the specific requirements of this part, and that the total compensation for individual employees: (1) Is reasonable for the services rendered and conforms to the establish written policy of the non-Federal entity consistently applied to both Federal and non-Federal activities; (2) Follows an appointment made in accordance with a non-Federal entity’s laws and/or rules or written policies and meets the requirements of Federal statute, where applicable; and (3) Is determined and supported as provided in paragraph (i) of this section, Standards for Documentation of Personnel Expenses, when applicable.” 2 CFR Section 200.430 (g): Standards for Documentation of Personnel Expenses. (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control that provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the recipient or subrecipient; (iii) Reasonably reflect the total activity for which the employee is compensated by the recipient or subrecipient, not exceeding 100 percent of compensated activities; (iv) Encompass federally-assisted and all other activities compensated by the recipient or subrecipient on an integrated basis but may include the use of subsidiary records as defined in the recipient's or subrecipient's written policy; (v) Comply with the established accounting policies and procedures of the recipient or subrecipient; (vi) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (vii) Budget estimates (meaning, estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity performed; (B) Significant changes in the related work activity (as defined by the recipient's or subrecipient's written policies) are promptly identified and entered into the records. Short-term (such as one or two months) fluctuations between workload categories do not need to be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The recipient's or subrecipient's system of internal controls includes processes to perform periodic after-the-fact reviews of interim charges made to a Federal award based on budget estimates. All necessary adjustments must be made so that the final amount charged to the Federal award is accurate, allowable, and properly allocated. Condition – We noted that the DBH allocated payroll expenditures to the Block Grants for Substance Use Prevention, Treatment and Recovery Services (SUPTRS) during fiscal year 2024 based on budgeted percentages. These percentages were entered into the PeopleSoft Human Resources/Payroll System (PeopleSoft) at the beginning of the fiscal year and were based on management’s estimate of the respective employee’s level of effort for each program. PeopleSoft calculated the payroll costs every payroll cycle for each employee and program based on the predetermined percentage, and reported it through the Labor Distribution Report (485 Report). However, management cannot provide supporting documentation regarding the periodic comparison of actual costs to the budgeted costs as required by 2 CFR Section 200.430. Specifically, 17 out of 60 sampled payroll items tested for the SUPTRS program were recorded based on estimated hours and not actual hours. For the other 43 sampled items, these individuals worked 100% of their time on SUPTRS, therefore, there is no possibility of error. Questioned Costs – Known amount is $43,235. Context – This is a condition identified per review of DBH’s compliance with specified requirements using a statistically valid sample. Payroll costs, including fringe benefits, for the SUPTRS program in fiscal year 2024 totaled $4,667,478. Effect – DBH was unable to demonstrate that the payroll expenditures charged to the SUPTRS program accurately reflected the actual time incurred on the program and such expenditures were properly supported in accordance with 2 CFR Section 200.430, Compensation – Personal Services. Cause – DBH does not have policies and procedures in place to review and reconcile the estimated amount of payroll expenditures charged to the SUPTRS Program to the actual expenditures incurred. Recommendation – We recommend that DBH deploy policies and procedures to periodically compare employees’ estimated hours per the 485 Report to the actual hours incurred, and make any necessary adjustments as required by 2 CFR Section 200.430. Related Noncompliance – Material noncompliance. Views of Responsible Officials and Planned Corrective Actions – DBH agrees with the findings and will put controls in place to resolve the issue. The District’s corrective action is described in the Management’s Corrective Action Plan included as Appendix B of the attached Management’s Section.
Finding Number: 2024-034 Prior Year Finding Number: N/A Compliance Requirement: Activities Allowed or Unallowed and Allowable Costs/Cost Principles Program: U.S. Department of Health and Human Services Block Grants for Substance Use Prevention, Treatment, and Recovery Services ALN: 93.959 Award #: Various Award Years: 10/01/2022 – 09/30/2024; 03/15/2021 – 03/14/2025 Government Department/Agency: Department of Behavioral Health (DBH) Criteria - The Uniform Guidance in 2 CFR Section 200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Per 2 CFR Section 200.430 Compensation – Personal Services: “Costs of compensation are allowable to the extent that they satisfy the specific requirements of this part, and that the total compensation for individual employees: (1) Is reasonable for the services rendered and conforms to the establish written policy of the non-Federal entity consistently applied to both Federal and non-Federal activities; (2) Follows an appointment made in accordance with a non-Federal entity’s laws and/or rules or written policies and meets the requirements of Federal statute, where applicable; and (3) Is determined and supported as provided in paragraph (i) of this section, Standards for Documentation of Personnel Expenses, when applicable.” 2 CFR Section 200.430 (g): Standards for Documentation of Personnel Expenses. (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control that provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the recipient or subrecipient; (iii) Reasonably reflect the total activity for which the employee is compensated by the recipient or subrecipient, not exceeding 100 percent of compensated activities; (iv) Encompass federally-assisted and all other activities compensated by the recipient or subrecipient on an integrated basis but may include the use of subsidiary records as defined in the recipient's or subrecipient's written policy; (v) Comply with the established accounting policies and procedures of the recipient or subrecipient; (vi) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (vii) Budget estimates (meaning, estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity performed; (B) Significant changes in the related work activity (as defined by the recipient's or subrecipient's written policies) are promptly identified and entered into the records. Short-term (such as one or two months) fluctuations between workload categories do not need to be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The recipient's or subrecipient's system of internal controls includes processes to perform periodic after-the-fact reviews of interim charges made to a Federal award based on budget estimates. All necessary adjustments must be made so that the final amount charged to the Federal award is accurate, allowable, and properly allocated. Condition – We noted that the DBH allocated payroll expenditures to the Block Grants for Substance Use Prevention, Treatment and Recovery Services (SUPTRS) during fiscal year 2024 based on budgeted percentages. These percentages were entered into the PeopleSoft Human Resources/Payroll System (PeopleSoft) at the beginning of the fiscal year and were based on management’s estimate of the respective employee’s level of effort for each program. PeopleSoft calculated the payroll costs every payroll cycle for each employee and program based on the predetermined percentage, and reported it through the Labor Distribution Report (485 Report). However, management cannot provide supporting documentation regarding the periodic comparison of actual costs to the budgeted costs as required by 2 CFR Section 200.430. Specifically, 17 out of 60 sampled payroll items tested for the SUPTRS program were recorded based on estimated hours and not actual hours. For the other 43 sampled items, these individuals worked 100% of their time on SUPTRS, therefore, there is no possibility of error. Questioned Costs – Known amount is $43,235. Context – This is a condition identified per review of DBH’s compliance with specified requirements using a statistically valid sample. Payroll costs, including fringe benefits, for the SUPTRS program in fiscal year 2024 totaled $4,667,478. Effect – DBH was unable to demonstrate that the payroll expenditures charged to the SUPTRS program accurately reflected the actual time incurred on the program and such expenditures were properly supported in accordance with 2 CFR Section 200.430, Compensation – Personal Services. Cause – DBH does not have policies and procedures in place to review and reconcile the estimated amount of payroll expenditures charged to the SUPTRS Program to the actual expenditures incurred. Recommendation – We recommend that DBH deploy policies and procedures to periodically compare employees’ estimated hours per the 485 Report to the actual hours incurred, and make any necessary adjustments as required by 2 CFR Section 200.430. Related Noncompliance – Material noncompliance. Views of Responsible Officials and Planned Corrective Actions – DBH agrees with the findings and will put controls in place to resolve the issue. The District’s corrective action is described in the Management’s Corrective Action Plan included as Appendix B of the attached Management’s Section.
Finding 2024-003: Unsupported Payroll Charges and Improper Drawdown of Federal Funds Compliance Requirements: Allowable Costs/Cost Principles; Cash Management; Reporting Type: Material Weakness in Internal Control over Compliance and Material Noncompliance Federal Agency: U.S. Department of Health and Human Services (Centers for Disease Control and Prevention) AL Numbers and Titles: 93.809 – National Organizations for Chronic Disease Prevention and Health Promotion Federal Award Number: NU58DP007562 Questioned Costs: $423,094 Repeat Finding: No Criteria: In accordance with 2 CFR §200.403 and §200.405, costs charged to a federal award must be necessary, reasonable, and allocable, and must conform to the terms and conditions of the award. Per 2 CFR §200.430(i), charges for salaries and wages must be supported by records that accurately reflect the work performed and be supported by a system of internal control. Furthermore, 2 CFR §200.305(b) requires that non-federal entities minimize the time between federal fund drawdown and disbursement, and limits advances to amounts needed for the immediate cash requirements of the program. Condition: During our testing of payroll-related transactions charged to the 93.809 federal program, we identified a significant reallocation of personnel costs from unrestricted funds to the federal grant that occurred late in the audit period. These charges related to multiple employees whose compensation was not included in the originally approved budget for the federal program. At the time of our testing, no formal budget revision had been submitted to the awarding agency, and the names of these staff had not been recorded in the federal grant reporting system as required by the award terms. Additionally, the auditee was unable to provide any documentation, such as certifications, labor distribution reports, calendars, or other records, to support that these employees worked on activities allocable to the federal program. We further noted that the auditee drew down federal funds prior to the recording of these payroll charges, at a time when the costs in question had neither been incurred nor documented. This resulted in federal funds being drawn in advance of need, contrary to federal cash management requirements. Cause: The auditee did not have adequate internal controls to ensure that only appropriately budgeted and documented payroll costs were charged to the federal award. In addition, the organization lacked procedures to confirm that federal funds were drawn only for costs that were allowable, incurred, and supported at the time of drawdown. These weaknesses allowed significant payroll reallocations to be processed retroactively without timely budget amendments or sufficient documentation of allocability. Effect: As a result of these control deficiencies, a total of $423,094 in personnel-related costs, including direct salaries, fringe benefits, and associated indirect costs, was charged to the federal program without appropriate budget authorization or time and effort support. These unsupported costs were also used as the basis for a drawdown of federal funds that occurred before the expenditures were recorded or substantiated. This resulted in noncompliance with both cost principles and cash management requirements and exposes the auditee to potential disallowance or repayment of federal funds. Recommendation: We recommend that the auditee enhance internal controls related to grant budgeting, payroll allocations, and cash management. These controls should ensure that payroll costs charged to federal awards are included in the approved budget or are formally revised and submitted to the grantor, are supported by accurate time and effort documentation, and that federal funds are drawn only when actual, allowable costs have been incurred and documented. We further recommend that the auditee consult with the awarding agency to determine whether any retroactive budget revision or corrective action is available or whether repayment of questioned costs will be required. Views of Responsible Officials Corrective Actions: Management agrees with this finding. Please refer to the Corrective Action Plan.
2024-002: Allowable Costs – Social Security State Grants for Work Incentives Assistance to Disabled Beneficiaries – Federal Assistance Listing Number 96.009; Award Period: Year ended September 30, 2024. Allowable costs - Protection and Advocacy for Individuals with Mental Illness Assistance - Federal Assistance Listing Number 93.138; Award Period: Year ended September 30, 2024. Criteria: Per 2 CFR §200.430(i), non-federal entities are required to maintain records that accurately reflect work performed. These records must be supported by a system of internal control which provides reasonable assurance that the time being charged is accurate, allowable and properly allocated, are incorporated in the official records, such as payroll records, reasonably reflect the employee’s total activity, provide a time or percentage breakdown on all activities, both federally and non-federally funded, for the employee, and comply with the non-federal entity’s pre-established accounting practices and procedures. Condition: The Center allowed payroll related costs to be submitted for reimbursement under the grant for time that did not match approved timesheets. This is not in compliance with program allowable cost requirements. Context: The amount allocated to the federal awards for numerous employees differed from the amount that was actually worked on the grant based on timesheet and approved pay rate. Cause: The Center allocates all of payroll based on hours worked on each program, rather than actual dollars spent on payroll for each program. This allocation method is appropriate for administrative employees who do not directly track their time to grants, but not for those who do. Effect: The Center billed the incorrect amount of payroll and related costs to the federal program, resulting in questioned costs. Questioned Costs: The amount of payroll and related costs discovered to be incorrect are under the questioned costs reporting threshold. Recommendation: We recommend the Center change its process to allocate payroll based on actual dollar amount rather than hours for employees who track their time across the grants. This will result in more accurate allocation of expenditures to federal programs. Views of Responsible Officials: dLCV will implement a weighted direct bill process beginning October 1, 2025. Throughout the audit review, and as recently as one month before the final report, the auditors consistently reported to us that this was likely not a compliance issue. Additionally, the auditors were not able to provide any sample for any time period in 2024 showing the potential impact of changing from an hours allocation to a dollars allocation. The auditors did not inform us of their changed opinion until late August, 2025, making it impossible to make any adjustments in the current fiscal year.
2024-003: Allowable Costs – Social Security State Grants for Work Incentives Assistance to Disabled Beneficiaries – Federal Assistance Listing Number 96.009; Award Period: Year ended September 30, 2024. Allowable costs - Protection and Advocacy for Individuals with Mental Illness Assistance - Federal Assistance Listing Number 93.138; Award Period: Year ended September 30, 2024. Criteria: Per 2 CFR §200.430(i), non-federal entities are required to maintain records that accurately reflect work performed. These records must be supported by a system of internal control which provides reasonable assurance that the time being charged is accurate, allowable and properly allocated, are incorporated in the official records, such as payroll records, reasonably reflect the employee’s total activity, provide a time or percentage breakdown on all activities, both federally and non-federally funded, for the employee, and comply with the non-federal entity’s pre-established accounting practices and procedures. Condition: The Center allowed payroll related costs to be submitted for reimbursement under the grant derived from timesheets that were not properly approved. Context: There were several timesheets without proper approval. Cause: There is a lack of proper review of timesheets. Effect: The Center billed payroll based on timesheets that were not properly approved. This risks the amount of payroll billed to the federal programs being inaccurate. Questioned Costs: Unknown. Recommendation: We recommend the Center ensures that timesheets are properly approved prior to processing payroll and billing to federal programs. Views of Responsible Officials: dLCV has refined our policies regarding review of timesheets to ensure that all timesheets are timely submitted and are reviewed and approved by designated staff.
Finding 2024-002 - Significant Deficiency Federal Program: Education Stabilization Fund (ESF) - ALN 84.425 Criteria: In accordance with 2 CFR §200.430, compensation for personal services must be based on records that accurately reflect the work performed and must be consistent with the entity’s established salary schedule. Adequate internal controls must be in place to ensure that payroll disbursements are calculated and paid accurately in accordance with approved compensation policies. Condition: It was noted during single audit testing that certain employees tested were paid less than the amounts specified in the Board’s published salary schedule, thus resulting in underpayment. Cause: The underpayments occurred due to a lack of adequate internal controls to ensure payroll amounts were calculated in accordance with the approved salary schedule. Specifically, there was no documented review or verification process in place to confirm that employee pay amounts aligned with the published salary schedule, which allowed the discrepancies to go undetected. Effect: As a result of this control weakness, the Board’s financial records did not reflect accurate payroll expenses and related liabilities. This error represents a significant potential misstatement and indicates a systemic issue in payroll processing controls. However, since the payroll costs were not charged to the grant, and no unallowable costs were identified, the amounts are not considered questioned costs and no noncompliance was identified. This control deficiency is considered a significant deficiency in internal control over compliance. Recommendation: The Board should strengthen its internal control procedures over payroll processing by implementing a formal, documented review process to ensure all employee compensation is properly calculated in accordance with the published salary schedule prior to payment. Management should also perform periodic reconciliations of payroll amounts to approved salary schedules as part of ongoing monitoring procedures. Views of Responsible Officials: The Board agrees with the finding and acknowledges the payroll errors identified. Upon notification, the Board reviewed the payroll records of the certain employees with identified errors and confirmed the underpayments. Corrective action was taken on the identified employees and the Board issued checks to pay the difference owed. The Board is also implementing additional review procedures to ensure that future payroll is processed in accordance with approved salary schedules.
Program: ALN 84.425V, Department of Education, Education Stabilization Fund, Emergency Assistance to Non-Public Schools, passed through the State of Alaska, grant number CO23.244.01/1004 052132102 2211Criteria: 2 CFR section 200.303(d)(2), states that a non-federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statues, regulations, and the terms and conditions of the federal award. 2 CFR section 200.430(g)(1), states that charges to Federal awards for salaries and wages must be supported by a system of internal control that provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Condition: SAAMS’ policies require a payroll batch report be reviewed prior to issuing payroll. This payroll batch report specifies employee name, program charged, amount charged to each program, hours, and pay rate. During our testing, we identified that the payroll batch report did not always contain amounts charged to each program or pay rates, making the review ineffective. Cause: Turnover in personnel during the fiscal year led to inadequate training and inconsistent performance of the payroll batch report review. Effect: Unallowable payroll costs may be charged to a federal program. Questioned costs: None Context: During our testing of 11 payroll batch reports, 5 did not contain pay rates or amounts charged to each program. Statistical sampling: No Repeat finding: No Recommendation: We recommend the entity develop policies that incorporate standardized reporting and description of the review objective, along with training to staff.
Finding: 2024-004 Time/Salary Allocations (Significant Deficiency) Information on the Federal Programs: ALN #21.027 Coronavirus State and Local Fiscal Recovery Funds Criteria or Specific Requirement (including Statutory, Regulatory, or Other Citation): CFR §200.430 Compensation—personal services. States; (g) Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. Criteria or Specific Requirement (including Statutory, Regulatory, or Other Citation) (continued): 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; (vii) Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. Condition: During our audit of DOL’s compensation practices, we noted that salaries and benefits charged to Federal programs were allocated using predetermined estimates rather than contemporaneous records reflecting actual time spent. These allocations were not supported by detailed documentation, such as timekeeping records or personnel activity reports, and the only support available was in the form of internal memos recorded in the general ledger. Cause: DOL has not implemented a system for documenting time and effort in a manner that complies with Federal requirements. The current process relies on estimates rather than actual, verifiable work performed. Effect or Potential Effect: Without accurate and documented time and effort reporting, there is a risk that Federal awards are either overcharged or undercharged for salaries and benefits. This creates the potential for noncompliance with Federal cost principles, and could lead to disallowed costs in the event of a monitoring or program audit. For ALN #21.027, we identified $80,985 in questioned costs, representing the total amount of unsupported salary and benefit charges to this program. Such deficiencies could also impair the Organization's eligibility for future Federal funding. Questioned Costs: $80,985 (all salaries and benefits changed to ALN #21.027) Context: We tested a statistically valid sample of employee salaries charged to Federal awards. The deficiencies noted were consistent across the sample population, indicating a systemic issue rather than isolated exceptions. Identification as a Repeat Finding, if Applicable: N/A Recommendation: We recommend that DOL strengthen its payroll allocation procedures to ensure compliance with 2 CFR §200.430. Specifically, we advise the following steps: 1. Implement Time and Effort Reporting: All employees whose salaries are charged in whole or in part to Federal awards should complete project-specific timesheets that record actual time spent on each cost objective or funding source. 2. Certifications and Approvals: Timesheets should be signed by the employee and reviewed and certified by their direct supervisor to confirm accuracy. 3. Allocate Based on Actual Time: Salaries and benefits should be allocated to funding sources based on the proportion of actual time worked, as indicated in approved timesheets, rather than based on estimates. 4. Incorporate into Internal Controls: These procedures should be incorporated into DOL’s internal control system and formally documented in its accounting policies and procedures manual. 5. Training and Oversight: Staff responsible for managing payroll allocations and Federal reporting should receive training on Federal time and effort requirements. Periodic internal reviews should be conducted to ensure adherence. By implementing these practices, DOL will significantly reduce the risk of questioned costs, improve compliance with Federal grant requirements, and strengthen the reliability of its financial reporting.
2024-039 - Inadequate Oversight of Davis-Bacon Compliance Federal Program 23.002 - Appalachian Area Development 14.228 - Community Development Block Grants/State's Program Award Numbers ARC-20698 ARC-20699 CDBG Subgrant: 1137-21-111-PF-01 Federal Agency U.S. Department of Housing and Urban Development (HUD) Appalachian Regional Commission (ARC) Compliance Requirement Special Tests and Provisions - Davis-Bacon Act (24 CFR §570.603) Type of Finding Internal Control over Compliance - Significant Deficiency Compliance - Noncompliance with Special Tests and Provisions Questioned Costs None Criteria Per 2 CFR §200.430 and Davis-Bacon Act requirements, recipients must ensure that contractors and subcontractors pay laborers and mechanics prevailing wage rates and fringe benefits as determined by the U.S. Department of Labor. Effective oversight includes documented review procedures, monitoring activities, and resolution of discrepancies. Condition For ARC MS-20699 and CDBG 1137-21-111-PF-01, the auditor tested 10 of 33 certified payrolls. Two payrolls (20%) omitted employee classifications, which were not identified during the grant administrator's review. A letter dated September 2, 2025, was later obtained certifying the employees were laborers and paid the appropriate wage and fringe rates. No documentation of prior corrective action was available. For ARC MS-20698, the auditor tested all 17 payrolls submitted. Four certified payrolls from the primary contractor were not submitted and could not be tested. Of the submitted payrolls: Two lacked employer signatures on WH-347 forms Three subcontractor payrolls listed employees as "plumber" or "plumber assistant," classifications not included in the applicable wage determination No SF-1444 conformance request was submitted to the Department of Labor One subcontractor payroll lacked a signed certification page In both grants, the grant administrator relied solely on visual checkmarks to indicate payroll review. No formal checklist, documentation of oversight, or corrective action procedures were maintained. Employee interviews were limited to a single date for ARC MS-20699 and to one employee for ARC MS-20698, with no wage rate recorded. Cause The City did not establish formal internal control procedures for Davis-Bacon oversight, including documented review protocols, periodic employee interviews, and a process for resolving discrepancies or following up on missing or incomplete payrolls. Effect Weaknesses in oversight may result in undetected noncompliance with Davis-Bacon requirements, including misclassification or underpayment of wages. The absence of classification, missing payrolls, and unapproved job categories prevent full verification of wage rate compliance. These deficiencies represent both a significant deficiency in internal control and procedural noncompliance with Davis-Bacon provisions. Recommendation The City should implement formal internal control procedures for Davis-Bacon compliance, including: A documented payroll review checklist Periodic employee interviews throughout the construction period A process for identifying and resolving discrepancies Procedures for submitting SF-1444 conformance requests when needed Follow-up protocols for missing or unsigned certified payroll Views of Responsible Officials Management concurs with the finding. The City acknowledges that oversight of Davis-Bacon compliance was informal and lacked documentation. To strengthen internal controls, the City will implement a formal payroll review checklist and conduct periodic employee interviews throughout future construction projects. Staff will receive training on Davis-Bacon requirements, and a process will be established for identifying and resolving discrepancies in certified payrolls, including submission of conformance requests when necessary.
2024-038 - Inadequate Documentation of HIDTA Personnel Costs Federal Program 95-001 -- High Intensity Drug Trafficking Areas (HIDTA) Award Number G23-GC0003A Federal Agency Office of National Drug Control Policy Compliance Requirement Allowable Costs/Cost Principles - 2 CFR §200.430 Type of Finding Internal Control over Compliance - Significant Deficiency Compliance - Noncompliance Questioned Costs $14,418 Criteria Per 2 CFR §200.430, personnel costs charged to federal awards must be supported by records that accurately reflect the work performed and be subject to internal control review. Condition Although the HIDTA program was not selected for major program testing under the Single Audit, we identified this issue during the financial statement audit. The Police Department submitted payroll costs totaling $14,418 for HIDTA reimbursement across three quarters. Documentation included overtime forms and manual time cards that lacked sufficient detail, such as start/stop times, activity descriptions, and supervisor approval. These records do not meet the standards for supporting federal personnel costs under 2 CFR §200.430. Cause The City's internal controls over timekeeping and payroll documentation are not sufficient to ensure compliance with federal requirements. Effect Personnel costs totaling $14,418 are considered questioned costs due to inadequate documentation. These costs may be ineligible for reimbursement under the HIDTA program. Recommendation We recommend the City strengthen internal controls over payroll documentation and ensure that all personnel costs charged to federal awards are supported by detailed, approved records that clearly reflect HIDTA-related activities. Views of Responsible Officials Management concurs with the finding. The City acknowledges that payroll documentation submitted for HIDTA reimbursement lacked sufficient detail and formal approval. To address this, the City will implement a standardized timekeeping system that includes start/stop times, activity descriptions, and supervisor sign-off. Staff will receive training on federal documentation standards, and internal controls will be updated to ensure compliance with 2 CFR §200.430.
PROGRAM DESCRIPTION Reference Number: 2024-004 Proper review of payroll charges to grant funds ALN 84.425U & 84.425W COVID-19 Education Stabilization Fund Pass through identifying number: 21528001245902 Award Year: 2023-2024 Federal Agency: U.S. Department of Education Passed through State Department of Education Criteria: Non-federal entities are required to establish and maintain effective internal controls over compliance in accordance with 2 CFR 200.303(a) and 2 CFR 200.430(g) which requires that compensation charged to federal awards must be supported by a system of internal control that provides reasonable assurance that the charges are accurate, allowable, and properly allocated, of which documentation must be incorporated into the official records of the entity. Condition Found: During our review of payroll charges that were funded through ESSER funds, it was noted that the District did not have adequate controls in place to monitor the payroll transactions charged to the program. Cause: Although the District implemented Skyward in the prior year, the District did not integrate the appropriate approvals into the system in a timely manner. In addition, turnover in the District Chief Financial Officer position caused difficulties in the District obtaining the proper approvals for journal entries. Effect: The District could fail to appropriately support expenditures charged to the program. Questioned Cost: $0 Recommendation: We recommend the District to implement appropriate approvals in the Skyward accounting system to provide for better oversight of transactions. Views of Responsible Officials: Management agrees with the findings. See corrective action plan beginning on page 114.
PROGRAM DESCRIPTION Reference Number: 2024-004 Proper review of payroll charges to grant funds ALN 84.425U & 84.425W COVID-19 Education Stabilization Fund Pass through identifying number: 21528001245902 Award Year: 2023-2024 Federal Agency: U.S. Department of Education Passed through State Department of Education Criteria: Non-federal entities are required to establish and maintain effective internal controls over compliance in accordance with 2 CFR 200.303(a) and 2 CFR 200.430(g) which requires that compensation charged to federal awards must be supported by a system of internal control that provides reasonable assurance that the charges are accurate, allowable, and properly allocated, of which documentation must be incorporated into the official records of the entity. Condition Found: During our review of payroll charges that were funded through ESSER funds, it was noted that the District did not have adequate controls in place to monitor the payroll transactions charged to the program. Cause: Although the District implemented Skyward in the prior year, the District did not integrate the appropriate approvals into the system in a timely manner. In addition, turnover in the District Chief Financial Officer position caused difficulties in the District obtaining the proper approvals for journal entries. Effect: The District could fail to appropriately support expenditures charged to the program. Questioned Cost: $0 Recommendation: We recommend the District to implement appropriate approvals in the Skyward accounting system to provide for better oversight of transactions. Views of Responsible Officials: Management agrees with the findings. See corrective action plan beginning on page 114.
PROGRAM DESCRIPTION Reference Number: 2024-004 Proper review of payroll charges to grant funds ALN 84.425U & 84.425W COVID-19 Education Stabilization Fund Pass through identifying number: 21528001245902 Award Year: 2023-2024 Federal Agency: U.S. Department of Education Passed through State Department of Education Criteria: Non-federal entities are required to establish and maintain effective internal controls over compliance in accordance with 2 CFR 200.303(a) and 2 CFR 200.430(g) which requires that compensation charged to federal awards must be supported by a system of internal control that provides reasonable assurance that the charges are accurate, allowable, and properly allocated, of which documentation must be incorporated into the official records of the entity. Condition Found: During our review of payroll charges that were funded through ESSER funds, it was noted that the District did not have adequate controls in place to monitor the payroll transactions charged to the program. Cause: Although the District implemented Skyward in the prior year, the District did not integrate the appropriate approvals into the system in a timely manner. In addition, turnover in the District Chief Financial Officer position caused difficulties in the District obtaining the proper approvals for journal entries. Effect: The District could fail to appropriately support expenditures charged to the program. Questioned Cost: $0 Recommendation: We recommend the District to implement appropriate approvals in the Skyward accounting system to provide for better oversight of transactions. Views of Responsible Officials: Management agrees with the findings. See corrective action plan beginning on page 114.
PROGRAM DESCRIPTION Reference Number: 2024-004 Proper review of payroll charges to grant funds ALN 84.425U & 84.425W COVID-19 Education Stabilization Fund Pass through identifying number: 21528001245902 Award Year: 2023-2024 Federal Agency: U.S. Department of Education Passed through State Department of Education Criteria: Non-federal entities are required to establish and maintain effective internal controls over compliance in accordance with 2 CFR 200.303(a) and 2 CFR 200.430(g) which requires that compensation charged to federal awards must be supported by a system of internal control that provides reasonable assurance that the charges are accurate, allowable, and properly allocated, of which documentation must be incorporated into the official records of the entity. Condition Found: During our review of payroll charges that were funded through ESSER funds, it was noted that the District did not have adequate controls in place to monitor the payroll transactions charged to the program. Cause: Although the District implemented Skyward in the prior year, the District did not integrate the appropriate approvals into the system in a timely manner. In addition, turnover in the District Chief Financial Officer position caused difficulties in the District obtaining the proper approvals for journal entries. Effect: The District could fail to appropriately support expenditures charged to the program. Questioned Cost: $0 Recommendation: We recommend the District to implement appropriate approvals in the Skyward accounting system to provide for better oversight of transactions. Views of Responsible Officials: Management agrees with the findings. See corrective action plan beginning on page 114.
Allowable Costs/Activities Allowed – Personal Services Federal Agency: U.S. Department of Health and Human Services Federal Program Title: Epidemiology and Laboratory Capacity for Infectious Diseases ALN: 93.323 Pass-Through Agency: N/A Pass-Through Number(s): N/A Award Number and Period: 6 NU50CK000501-01-08, 6 NU50CK000501-02-17 August 1, 2019 – July 31, 2024, August 1, 2019 – July 31, 2027 Statistically Valid Sample: No, and not intended to be a statistically valid sample. Type of Finding: Significant Deficiency in Internal Control over Compliance and Noncompliance Criteria or specific requirement: Per 2 CFR section 200.303(a), the Texas Department of State Health Services (DSHS) must establish and maintain effective internal control over the Federal award that provides reasonable assurance that it 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). Per 2 CFR 200.430 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: (i) Be supported by an internal control system that ensures the charges are accurate, allowable, and properly allocated; (ii) be incorporated into the official records of the non-Federal entity; (iii) reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities; (iv) encompass federally-assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity's written policy; (v) comply with the established accounting policies and practices of the non-Federal entity; (vi) support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (vii) Budget estimates (meaning, estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity performed; (B) Significant changes in the related work activity (as defined by the recipient's or subrecipient's written policies) are promptly identified and entered into the records. Short-term (such as one or two months) fluctuations between workload categories do not need to be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The recipient's or subrecipient's system of internal controls includes processes to perform periodic after-the-fact reviews of interim charges made to a Federal award based on budget estimates. All necessary adjustments must be made so that the final amount charged to the Federal award is accurate, allowable, and properly allocated. Condition: DSHS requires its employees to complete monthly time and leave reporting, regardless of whether the employee works solely on a single federal award or cost objective, or on multiple activities or cost objectives. Each employee has a default task profile based on their position in the agency that determines how their payroll and payroll-related dollars are allocated. Employees are instructed and given training on how to report any deviations from their profile as well as report any vacation time, sick time, leave of absence, etc. Employees are required to certify their time by the 10th of the month for the previous months’ time. Like all DSHS employees, supervisors are required to certify their time monthly. However, their time certification includes an additional affirmation which states the supervisor has performed the following: Reviewed the default task profile/labor account code for each of their direct reports. Reviewed the timesheets for all direct reports as compared to the default task profiles/labor account codes for accuracy of time worked and adjusted if necessary. For direct reports who have reported deviations, reviewed and verified the deviations reported and approved the respective timesheet. This documented affirmation provides sufficient documentation to indicate that the supervisors have reviewed after the fact interim payroll and payroll-related charges made to federal awards based on budget estimates. Audit procedures included a selection of 40 payroll-related expenditures incurred during the fiscal year totaling $191,809. For five of the 40 samples selected, the employee supervisor did not certify their monthly timesheet, and thus did not acknowledge neither the review of the employees’ default task profile/account labor code or their timesheets. Questioned costs: None. Context: See “Condition.” Cause: All five of the exceptions noted were directly reporting to the same supervisor. The monthly timesheets selected were during the months of July and August 2024. The supervisor was recently hired in April 2024 and was unaware of the requirement to certify monthly. Effect: Without the supervisor timesheet certification, there is a lack of sufficient documentation to indicate that they have reviewed after-the-fact interim payroll and payroll-related charges made to the federal awards based on budget estimates. Repeat Finding: No Recommendation: DSHS should enhance new hire training policies and procedures to ensure all new hire trainings clearly address labor account codes, monthly time reporting, and task profiles. Views of responsible officials: DSHS has robust timekeeping controls but recognizes this opportunity to enhance training with reinforcement for new supervisors.
Allowable Costs/Activities Allowed – Personal Services Federal Agency: U.S. Department of Health and Human Services Federal Program Title: Epidemiology and Laboratory Capacity for Infectious Diseases ALN: 93.323 Pass-Through Agency: N/A Pass-Through Number(s): N/A Award Number and Period: 6 NU50CK000501-01-08, 6 NU50CK000501-02-17 August 1, 2019 – July 31, 2024, August 1, 2019 – July 31, 2027 Statistically Valid Sample: No, and not intended to be a statistically valid sample. Type of Finding: Significant Deficiency in Internal Control over Compliance and Noncompliance Criteria or specific requirement: Per 2 CFR section 200.303(a), the Texas Department of State Health Services (DSHS) must establish and maintain effective internal control over the Federal award that provides reasonable assurance that it 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). Per 2 CFR 200.430 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: (i) Be supported by an internal control system that ensures the charges are accurate, allowable, and properly allocated; (ii) be incorporated into the official records of the non-Federal entity; (iii) reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities; (iv) encompass federally-assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity's written policy; (v) comply with the established accounting policies and practices of the non-Federal entity; (vi) support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (vii) Budget estimates (meaning, estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity performed; (B) Significant changes in the related work activity (as defined by the recipient's or subrecipient's written policies) are promptly identified and entered into the records. Short-term (such as one or two months) fluctuations between workload categories do not need to be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The recipient's or subrecipient's system of internal controls includes processes to perform periodic after-the-fact reviews of interim charges made to a Federal award based on budget estimates. All necessary adjustments must be made so that the final amount charged to the Federal award is accurate, allowable, and properly allocated. Condition: DSHS requires its employees to complete monthly time and leave reporting, regardless of whether the employee works solely on a single federal award or cost objective, or on multiple activities or cost objectives. Each employee has a default task profile based on their position in the agency that determines how their payroll and payroll-related dollars are allocated. Employees are instructed and given training on how to report any deviations from their profile as well as report any vacation time, sick time, leave of absence, etc. Employees are required to certify their time by the 10th of the month for the previous months’ time. Like all DSHS employees, supervisors are required to certify their time monthly. However, their time certification includes an additional affirmation which states the supervisor has performed the following: Reviewed the default task profile/labor account code for each of their direct reports. Reviewed the timesheets for all direct reports as compared to the default task profiles/labor account codes for accuracy of time worked and adjusted if necessary. For direct reports who have reported deviations, reviewed and verified the deviations reported and approved the respective timesheet. This documented affirmation provides sufficient documentation to indicate that the supervisors have reviewed after the fact interim payroll and payroll-related charges made to federal awards based on budget estimates. Audit procedures included a selection of 40 payroll-related expenditures incurred during the fiscal year totaling $191,809. For five of the 40 samples selected, the employee supervisor did not certify their monthly timesheet, and thus did not acknowledge neither the review of the employees’ default task profile/account labor code or their timesheets. Questioned costs: None. Context: See “Condition.” Cause: All five of the exceptions noted were directly reporting to the same supervisor. The monthly timesheets selected were during the months of July and August 2024. The supervisor was recently hired in April 2024 and was unaware of the requirement to certify monthly. Effect: Without the supervisor timesheet certification, there is a lack of sufficient documentation to indicate that they have reviewed after-the-fact interim payroll and payroll-related charges made to the federal awards based on budget estimates. Repeat Finding: No Recommendation: DSHS should enhance new hire training policies and procedures to ensure all new hire trainings clearly address labor account codes, monthly time reporting, and task profiles. Views of responsible officials: DSHS has robust timekeeping controls but recognizes this opportunity to enhance training with reinforcement for new supervisors.
Activities Allowed and Unallowed, Allowable Costs/Cost Principles – Personal Services Federal Agency: U.S. Department of Labor Federal Program Title: Employment Service Cluster ALN: 17.207, 17.801 Pass-Through Agency: N/A Pass-Through Number(s): N/A Award Number and Period: DV373362255548–01, 23555DV000036–01, 24555DV000076–01 October 1, 2021 – December 31, 2023, October 1, 2022 – December 31, 2024, October 1, 2023 – December 31, 2025 Statistically Valid Sample: No, and not intended to be a statistically valid sample Type of Finding: Significant Deficiency in Internal Control over Compliance and Nonompliance Criteria or specific requirement: Per 2 CFR section 200.303(a), Texas Veterans Commission (TVC) 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) Per 2 CFR 200.430 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: (i) Be supported by a system of internal control that provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the recipient or subrecipient; (iii) Reasonably reflect the total activity for which the employee is compensated by the recipient or subrecipient, not exceeding 100 percent of compensated activities (iv) Encompass federally-assisted and all other activities compensated by the recipient or subrecipient on an integrated basis but may include the use of subsidiary records as defined in the recipient's or subrecipient's written policy; (v) Comply with the established accounting policies and procedures of the recipient or subrecipient (vi) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (vii) Budget estimates (meaning, estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity performed; (B) Significant changes in the related work activity (as defined by the recipient's or subrecipient's written policies) are promptly identified and entered into the records. Short-term (such as one or two months) fluctuations between workload categories do not need to be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The recipient's or subrecipient's system of internal controls includes processes to perform periodic after-the-fact reviews of interim charges made to a Federal award based on budget estimates. All necessary adjustments must be made so that the final amount charged to the Federal award is accurate, allowable, and properly allocated. Condition: Audit procedures included a sample of 40 expenditures for incurred for personnel services during the fiscal year to test whether the expenditures for salaries and wages were allowable and based on the records that accurately reflect the work performed. We noted that TVC prepares monthly budget reports that are reviewed by the program’s budget analyst and the respective program director or manager. Expenditures related to personnel services are recorded based on the budgeted amount for each individual. No periodic after-the-fact review is performed to verify that the final amount charged to the Federal award is accurate, allowable, and properly allocated. Questioned costs: None Context: See “Condition.” Cause: The employees working on the federal grant program are budgeted to work on the grant 100% of their time. Management deemed this sufficient to substantiate the final amounts charged to the grant. Effect: Lack of a periodic after-the-fact review to verify that the final amounts charged to the Federal award are accurate, allowable, and properly allocated may result in noncompliance with grant terms and conditions and questioned costs. Repeat Finding: No Recommendation: We recommend that management establish procedures and internal controls to perform an after-the-fact review of personnel services to verify that the final amounts charged to the Federal award are accurate, allowable, and properly allocated. This can be accomplished by a supervisor’s review and approval of the employee’s timesheet each pay period or an annual review where necessary adjustments are made. Views of responsible officials: TVC agrees to the recommendation of documenting review and approvals. To note, the monthly Veteran Employment Services (VES) Forecasts and Payroll reports had been reviewed with VES’s Director and/or Operations Manager as well as VES’s Annual State Plan before submission to the U.S. Department of Labor. VES’s Director or Operations Manager’s signature of approval was never documented for confirmation of review.
Activities Allowed and Unallowed, Allowable Costs/Cost Principles – Personal Services Federal Agency: U.S. Department of Labor Federal Program Title: Employment Service Cluster ALN: 17.207, 17.801 Pass-Through Agency: N/A Pass-Through Number(s): N/A Award Number and Period: DV373362255548–01, 23555DV000036–01, 24555DV000076–01 October 1, 2021 – December 31, 2023, October 1, 2022 – December 31, 2024, October 1, 2023 – December 31, 2025 Statistically Valid Sample: No, and not intended to be a statistically valid sample Type of Finding: Significant Deficiency in Internal Control over Compliance and Nonompliance Criteria or specific requirement: Per 2 CFR section 200.303(a), Texas Veterans Commission (TVC) 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) Per 2 CFR 200.430 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: (i) Be supported by a system of internal control that provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the recipient or subrecipient; (iii) Reasonably reflect the total activity for which the employee is compensated by the recipient or subrecipient, not exceeding 100 percent of compensated activities (iv) Encompass federally-assisted and all other activities compensated by the recipient or subrecipient on an integrated basis but may include the use of subsidiary records as defined in the recipient's or subrecipient's written policy; (v) Comply with the established accounting policies and procedures of the recipient or subrecipient (vi) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (vii) Budget estimates (meaning, estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity performed; (B) Significant changes in the related work activity (as defined by the recipient's or subrecipient's written policies) are promptly identified and entered into the records. Short-term (such as one or two months) fluctuations between workload categories do not need to be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The recipient's or subrecipient's system of internal controls includes processes to perform periodic after-the-fact reviews of interim charges made to a Federal award based on budget estimates. All necessary adjustments must be made so that the final amount charged to the Federal award is accurate, allowable, and properly allocated. Condition: Audit procedures included a sample of 40 expenditures for incurred for personnel services during the fiscal year to test whether the expenditures for salaries and wages were allowable and based on the records that accurately reflect the work performed. We noted that TVC prepares monthly budget reports that are reviewed by the program’s budget analyst and the respective program director or manager. Expenditures related to personnel services are recorded based on the budgeted amount for each individual. No periodic after-the-fact review is performed to verify that the final amount charged to the Federal award is accurate, allowable, and properly allocated. Questioned costs: None Context: See “Condition.” Cause: The employees working on the federal grant program are budgeted to work on the grant 100% of their time. Management deemed this sufficient to substantiate the final amounts charged to the grant. Effect: Lack of a periodic after-the-fact review to verify that the final amounts charged to the Federal award are accurate, allowable, and properly allocated may result in noncompliance with grant terms and conditions and questioned costs. Repeat Finding: No Recommendation: We recommend that management establish procedures and internal controls to perform an after-the-fact review of personnel services to verify that the final amounts charged to the Federal award are accurate, allowable, and properly allocated. This can be accomplished by a supervisor’s review and approval of the employee’s timesheet each pay period or an annual review where necessary adjustments are made. Views of responsible officials: TVC agrees to the recommendation of documenting review and approvals. To note, the monthly Veteran Employment Services (VES) Forecasts and Payroll reports had been reviewed with VES’s Director and/or Operations Manager as well as VES’s Annual State Plan before submission to the U.S. Department of Labor. VES’s Director or Operations Manager’s signature of approval was never documented for confirmation of review.
Section 2 - Federal and State Award Findings and Questioned Costs Significant Deficiency 2024-001 Payroll costs were allocated to incorrect programs Prevention and Treatment of Substance Abuse, CFDA #93.959, Pass-Through Grant #HHS000539700192 Criteria: In accordance with Uniform Guidance (2 CFR § 200.430g), payroll costs must be charged accurately to federal awards and should be supported by records that appropriately reflect the work performed. Condition: Payroll costs reported for the associated programs under pass-through grant #HHS000539700192 totaling approximately $30,242 were erroneously charged to the incorrect program. Cause: The issue was caused by coding errors in the accounting system during payroll processing. The responsible personnel mistakenly allocated the employees' hours to incorrect program codes for certain employees and pay periods without adequate review and reconciliation to the source timesheets. Effect: Payroll costs for the individual programs under CFDA #93.959, Pass-Through Grant #HHS000539700192 were overstated in total by approximately $30,242. Questioned Costs: Approximately $30,242 Context: The finding was isolated to payroll costs and for only certain employees and pay periods, and no findings were identified related to other non-personnel direct or indirect costs or other compliance requirements. Repeat Finding: No Recommendation: We recommend that the Organization strengthen internal controls over payroll cost allocations, including adding an additional layer of review over payroll and ensuring the payroll data in the accounting system is properly reconciled to the employees' timesheets each pay period. Additionally, as possible, we recommend configuring validation controls in the accounting system to help prevent employees from being charged to incorrect program codes. Views of Responsible Officials and Planned Corrections Actions: Management agrees with the audit finding and a response is included in the corrective action plan.
Health Center Program Cluster AL No. 93.224 and 93.527 U.S. Department of Health and Human Services Award No. H80CS00438, H8FCS40427, H8GCS47600 Healthy Start Initiative AL No. 93.926 Us. Department of Health and Human Services Award No. H49MC00156 Criteria: Under 2 CFR 200.430, payroll expenses must be based on records that accurately reflect the work performed and supported by a system of internal control that provides reasonable assurance that charges are accurate, allowable, and properly allocated. Condition: During the testing performed, it was noted that the Organization transferred payroll costs between programs, however, no time and effort certification or equivalent documentation was updated to reflect the changes. Additionally, the transfer of payroll costs between grants was not properly reflected within the accounting system records by grant. These transfers between grants were completed after the end of the fiscal year. Cause: During the year the Organization had new grants, but the payroll system was not updated to reflect the changes. Effect: Allocation of payroll costs to the federal award program may be inaccurate or not properly documented. Questioned costs: n/a Context: The Organization did not maintain supporting documentation for payroll costs that were reallocated to a new grant. These costs were reallocated from the Health Center Program and from the Healthy Start Initiative funding to the new award. Repeat Finding: No Recommendation: The Organization should review and update the policies and procedures regarding payroll costs. Additionally, the Organization should provide training to staff on grant tracking and documentation. Views of Responsible Officials: Management agrees with this finding. Staff will be trained to ensure future changes in payroll costs are updated timely within the system and documentation maintained.
Health Center Program Cluster AL No. 93.224 and 93.527 U.S. Department of Health and Human Services Award No. H80CS00438, H8FCS40427, H8GCS47600 Healthy Start Initiative AL No. 93.926 Us. Department of Health and Human Services Award No. H49MC00156 Criteria: Under 2 CFR 200.430, payroll expenses must be based on records that accurately reflect the work performed and supported by a system of internal control that provides reasonable assurance that charges are accurate, allowable, and properly allocated. Condition: During the testing performed, it was noted that the Organization transferred payroll costs between programs, however, no time and effort certification or equivalent documentation was updated to reflect the changes. Additionally, the transfer of payroll costs between grants was not properly reflected within the accounting system records by grant. These transfers between grants were completed after the end of the fiscal year. Cause: During the year the Organization had new grants, but the payroll system was not updated to reflect the changes. Effect: Allocation of payroll costs to the federal award program may be inaccurate or not properly documented. Questioned costs: n/a Context: The Organization did not maintain supporting documentation for payroll costs that were reallocated to a new grant. These costs were reallocated from the Health Center Program and from the Healthy Start Initiative funding to the new award. Repeat Finding: No Recommendation: The Organization should review and update the policies and procedures regarding payroll costs. Additionally, the Organization should provide training to staff on grant tracking and documentation. Views of Responsible Officials: Management agrees with this finding. Staff will be trained to ensure future changes in payroll costs are updated timely within the system and documentation maintained.
Health Center Program Cluster AL No. 93.224 and 93.527 U.S. Department of Health and Human Services Award No. H80CS00438, H8FCS40427, H8GCS47600 Healthy Start Initiative AL No. 93.926 Us. Department of Health and Human Services Award No. H49MC00156 Criteria: Under 2 CFR 200.430, payroll expenses must be based on records that accurately reflect the work performed and supported by a system of internal control that provides reasonable assurance that charges are accurate, allowable, and properly allocated. Condition: During the testing performed, it was noted that the Organization transferred payroll costs between programs, however, no time and effort certification or equivalent documentation was updated to reflect the changes. Additionally, the transfer of payroll costs between grants was not properly reflected within the accounting system records by grant. These transfers between grants were completed after the end of the fiscal year. Cause: During the year the Organization had new grants, but the payroll system was not updated to reflect the changes. Effect: Allocation of payroll costs to the federal award program may be inaccurate or not properly documented. Questioned costs: n/a Context: The Organization did not maintain supporting documentation for payroll costs that were reallocated to a new grant. These costs were reallocated from the Health Center Program and from the Healthy Start Initiative funding to the new award. Repeat Finding: No Recommendation: The Organization should review and update the policies and procedures regarding payroll costs. Additionally, the Organization should provide training to staff on grant tracking and documentation. Views of Responsible Officials: Management agrees with this finding. Staff will be trained to ensure future changes in payroll costs are updated timely within the system and documentation maintained.
Health Center Program Cluster AL No. 93.224 and 93.527 U.S. Department of Health and Human Services Award No. H80CS00438, H8FCS40427, H8GCS47600 Healthy Start Initiative AL No. 93.926 Us. Department of Health and Human Services Award No. H49MC00156 Criteria: Under 2 CFR 200.430, payroll expenses must be based on records that accurately reflect the work performed and supported by a system of internal control that provides reasonable assurance that charges are accurate, allowable, and properly allocated. Condition: During the testing performed, it was noted that the Organization transferred payroll costs between programs, however, no time and effort certification or equivalent documentation was updated to reflect the changes. Additionally, the transfer of payroll costs between grants was not properly reflected within the accounting system records by grant. These transfers between grants were completed after the end of the fiscal year. Cause: During the year the Organization had new grants, but the payroll system was not updated to reflect the changes. Effect: Allocation of payroll costs to the federal award program may be inaccurate or not properly documented. Questioned costs: n/a Context: The Organization did not maintain supporting documentation for payroll costs that were reallocated to a new grant. These costs were reallocated from the Health Center Program and from the Healthy Start Initiative funding to the new award. Repeat Finding: No Recommendation: The Organization should review and update the policies and procedures regarding payroll costs. Additionally, the Organization should provide training to staff on grant tracking and documentation. Views of Responsible Officials: Management agrees with this finding. Staff will be trained to ensure future changes in payroll costs are updated timely within the system and documentation maintained.
Finding Number 2024-001: Represents a significant deficiency in internal control over compliance with Western Maine Community Action, Inc.’s major federal programs. Repeat Finding: Yes Type of Finding: Significant Deficiency in Internal Control Over Compliance Description: Payroll Expenditures – Approval of Time Sheets Major Programs: AL#10.557 - WIC Special Supplemental Nutrition Program for Women, Infants and Children – Award numbers: CD3-22-4658B and CD3-24-4658A; AL#81.042 – Weatherization – 80224, 80225, 81323, and 84023; AL#93.569 – Community Services Block Grant – Award numbers: CFS-23-7009 and CFS-24-7009 Questioned Costs: None How the questioned costs were computed: N/A Compliance Requirement: Activities Allowed or Unallowed and Allowable Costs, Cost Principles Condition: Out of a sample of 80 payroll transactions there were 3 where the timesheet was not properly approved by the supervisor prior to payroll being processed. Criteria: 2 CFR 200.430(i) states that “Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated”. Cause: The Organization does not have the proper review process in place to ensure that the timesheets are reviewed by supervisors prior to payroll being processed. Effect: Without proper review and approval of the hours allocated to the grants on the employee timesheets, it is possible that grants could be over or undercharged. Recommendation: We recommend the Organization implement systems and procedures to ensure timesheets are approved by supervisors prior to payroll being processed, to ensure grants are charged for the correct amount of payroll expenses. View of Responsible Officials: Management agrees with the findings and has committed to a corrective action plan.
Finding Number 2024-001: Represents a significant deficiency in internal control over compliance with Western Maine Community Action, Inc.’s major federal programs. Repeat Finding: Yes Type of Finding: Significant Deficiency in Internal Control Over Compliance Description: Payroll Expenditures – Approval of Time Sheets Major Programs: AL#10.557 - WIC Special Supplemental Nutrition Program for Women, Infants and Children – Award numbers: CD3-22-4658B and CD3-24-4658A; AL#81.042 – Weatherization – 80224, 80225, 81323, and 84023; AL#93.569 – Community Services Block Grant – Award numbers: CFS-23-7009 and CFS-24-7009 Questioned Costs: None How the questioned costs were computed: N/A Compliance Requirement: Activities Allowed or Unallowed and Allowable Costs, Cost Principles Condition: Out of a sample of 80 payroll transactions there were 3 where the timesheet was not properly approved by the supervisor prior to payroll being processed. Criteria: 2 CFR 200.430(i) states that “Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated”. Cause: The Organization does not have the proper review process in place to ensure that the timesheets are reviewed by supervisors prior to payroll being processed. Effect: Without proper review and approval of the hours allocated to the grants on the employee timesheets, it is possible that grants could be over or undercharged. Recommendation: We recommend the Organization implement systems and procedures to ensure timesheets are approved by supervisors prior to payroll being processed, to ensure grants are charged for the correct amount of payroll expenses. View of Responsible Officials: Management agrees with the findings and has committed to a corrective action plan.
Finding Number 2024-001: Represents a significant deficiency in internal control over compliance with Western Maine Community Action, Inc.’s major federal programs. Repeat Finding: Yes Type of Finding: Significant Deficiency in Internal Control Over Compliance Description: Payroll Expenditures – Approval of Time Sheets Major Programs: AL#10.557 - WIC Special Supplemental Nutrition Program for Women, Infants and Children – Award numbers: CD3-22-4658B and CD3-24-4658A; AL#81.042 – Weatherization – 80224, 80225, 81323, and 84023; AL#93.569 – Community Services Block Grant – Award numbers: CFS-23-7009 and CFS-24-7009 Questioned Costs: None How the questioned costs were computed: N/A Compliance Requirement: Activities Allowed or Unallowed and Allowable Costs, Cost Principles Condition: Out of a sample of 80 payroll transactions there were 3 where the timesheet was not properly approved by the supervisor prior to payroll being processed. Criteria: 2 CFR 200.430(i) states that “Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated”. Cause: The Organization does not have the proper review process in place to ensure that the timesheets are reviewed by supervisors prior to payroll being processed. Effect: Without proper review and approval of the hours allocated to the grants on the employee timesheets, it is possible that grants could be over or undercharged. Recommendation: We recommend the Organization implement systems and procedures to ensure timesheets are approved by supervisors prior to payroll being processed, to ensure grants are charged for the correct amount of payroll expenses. View of Responsible Officials: Management agrees with the findings and has committed to a corrective action plan.
Finding Number 2024-001: Represents a significant deficiency in internal control over compliance with Western Maine Community Action, Inc.’s major federal programs. Repeat Finding: Yes Type of Finding: Significant Deficiency in Internal Control Over Compliance Description: Payroll Expenditures – Approval of Time Sheets Major Programs: AL#10.557 - WIC Special Supplemental Nutrition Program for Women, Infants and Children – Award numbers: CD3-22-4658B and CD3-24-4658A; AL#81.042 – Weatherization – 80224, 80225, 81323, and 84023; AL#93.569 – Community Services Block Grant – Award numbers: CFS-23-7009 and CFS-24-7009 Questioned Costs: None How the questioned costs were computed: N/A Compliance Requirement: Activities Allowed or Unallowed and Allowable Costs, Cost Principles Condition: Out of a sample of 80 payroll transactions there were 3 where the timesheet was not properly approved by the supervisor prior to payroll being processed. Criteria: 2 CFR 200.430(i) states that “Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated”. Cause: The Organization does not have the proper review process in place to ensure that the timesheets are reviewed by supervisors prior to payroll being processed. Effect: Without proper review and approval of the hours allocated to the grants on the employee timesheets, it is possible that grants could be over or undercharged. Recommendation: We recommend the Organization implement systems and procedures to ensure timesheets are approved by supervisors prior to payroll being processed, to ensure grants are charged for the correct amount of payroll expenses. View of Responsible Officials: Management agrees with the findings and has committed to a corrective action plan.
Finding Number 2024-001: Represents a significant deficiency in internal control over compliance with Western Maine Community Action, Inc.’s major federal programs. Repeat Finding: Yes Type of Finding: Significant Deficiency in Internal Control Over Compliance Description: Payroll Expenditures – Approval of Time Sheets Major Programs: AL#10.557 - WIC Special Supplemental Nutrition Program for Women, Infants and Children – Award numbers: CD3-22-4658B and CD3-24-4658A; AL#81.042 – Weatherization – 80224, 80225, 81323, and 84023; AL#93.569 – Community Services Block Grant – Award numbers: CFS-23-7009 and CFS-24-7009 Questioned Costs: None How the questioned costs were computed: N/A Compliance Requirement: Activities Allowed or Unallowed and Allowable Costs, Cost Principles Condition: Out of a sample of 80 payroll transactions there were 3 where the timesheet was not properly approved by the supervisor prior to payroll being processed. Criteria: 2 CFR 200.430(i) states that “Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated”. Cause: The Organization does not have the proper review process in place to ensure that the timesheets are reviewed by supervisors prior to payroll being processed. Effect: Without proper review and approval of the hours allocated to the grants on the employee timesheets, it is possible that grants could be over or undercharged. Recommendation: We recommend the Organization implement systems and procedures to ensure timesheets are approved by supervisors prior to payroll being processed, to ensure grants are charged for the correct amount of payroll expenses. View of Responsible Officials: Management agrees with the findings and has committed to a corrective action plan.
2024-007 Lack of Semi-Annual Certifications for Special Education Personnel Type of Finding: Material Weakness in Internal Control Over Compliance New or Repeat Finding: New Federal Program: Special Education Cluster (ALNs 84.027, 84.173) Federal Agency: U.S. Department of Education Pass-through Entity(ies): Texas Education Agency (246600010849086600, 246610010849086610, 66002406, 225350020849025000, 225360020849025360), Region 10 Education Service Center (236600497110001) Compliance Requirement: B - Allowable Costs / Costs Principles Criteria: Under 2 CFR 200.430(g), when employees work solely on a single federal award or cost objective, charges for their salaries must be supported by a system of internal control that provides reasonable assurance that the charges are accurate, allowable, and properly allocated. One allowable method is through completion of semi-annual certifications signed by the employee or a supervisory official with firsthand knowledge. These certifications provide assurance that salary costs charged to the federal program reflects the total activity for which the employee is compensated by the District, not exceeding 100% of compensated activities. Condition: The district did not maintain required semi-annual certifications for employees who worked solely on the Special Education Cluster (IDEA) programs. These certifications, which confirm that the employee worked 100% on the program for the period covered, were missing for all employees. Cause: The district did not have adequate procedures in place to ensure the forms were prepared, signed, and retained in accordance with federal requirements. Staff turnover and limited awareness of the documentation rules contributed to the oversight. Effect or Potential Effect: Without semi-annual certifications, the district lacks required documentation to fully support salary costs charged to the Special Education Cluster. This raises the risk that unallowable or unsupported personnel costs were charged to the program, even if employees were appropriately assigned. Questioned Costs: No questioned costs were identified, as auditors were able to verify through alternative procedures that employees worked solely on the program. The personnel records of the employees sampled contained approval of the employee to be hired into the appropriate job duties to be funded by special education cluster grant funds. Context: The district was unable to provide required semi-annual certifications for 14 out of 14 employees selected in our sample for testing. Recommendation: We recommend that the district develop and implement written procedures to ensure that semiannual certifications are prepared, signed, and retained for all employees working solely on federal programs. The district should provide training to finance and program staff to ensure continued compliance with federal documentation requirements. Views of Responsible Officials: District officials agree with the finding. The District has implemented new procedures in fiscal year 2025 to ensure semi-annual certifications are completed appropriately.