Finding Text
2023-006: Unallowable Costs
Federal Agency: Department of Education
Federal Program: COVID-19 Higher Education Emergency Relief Funds (HEERF)/Coronavirus Aid, Relief and Economic Security (CARES) Act – Institutional Portion
Assistance Listing Number: 84.425F
Federal Award Identification Number and Year: P425E205093
Award Period: July 1, 2022 to June 30, 2023
Type of Finding: Significant Deficiency in Internal Control over Compliance and Other Matters
Criteria: The Uniform Guidance Cost Principles described in 2 CFR Part 200, Compensation, states that costs of compensation are allowable to the extent that they satisfy the specific requirements of the grant and that total compensation for individual employees is reasonable for the services rendered. Salaries and benefits are allowable for this grant as long as the job duties are a result of responding to the pandemic. In addition, 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations and program compliance requirements.
Condition: The District charged unallowable costs to the grant related to an employee whose job duties were not related to the pandemic.
Questioned Costs: $3,341
Context: The District expended $1,951,384 in HEERF – Institutional Portion funds for direct costs during the fiscal year. The value of the sample tested was $22,736.
Cause: The District charged payroll costs for an employee in error.
Effect: Noncompliance with allowable cost principles.
Repeat Finding: This was not a finding in the prior year.
Recommendation: Implement procedures to ensure all grant expenditures are reviewed by fiscal management for additional review.
Views of responsible officials: Management concurs with the finding and plans to correct the finding.