Finding 1075448 (2023-001)

Significant Deficiency in Internal Control and Compliance over Major Programs Funding Agency: Department of Treasury ALN: 21.027 Criteria Internal controls and other compliance knowledge should prevent the incorrect coding of employee hours worked. Per 2 CFR 200.430(i)(1), "charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed." Condition Internal controls and adherence to compliance were not followed with regards to an appropriate level of approval of management that is charged to the Coronavirus State and Local Recovery Funds program. Questioned costs Total questioned cost of $7,475 based on six payroll transactions tested that were not approved at the appropriate level but were charged to the Coronavirus State and Loval Recovery Fund grant (ALN 21.027). Context During our payroll testing, of the six executive director timesheets tested, none of them indicated a secondary control offsetting the program manager. Effect The Coronavirus State and Local Recovery Funds program and other federal programs could be incorrectly charged. Cause The error was caused by not applying an adequate number of controls necessary for the executive director's timesheet. Repeat Finding Yes Auditor's Recommendation JSP recommends that the program manager and a member of the finance committee knowledge about 2 CFR 200.430(i)(1) review the executive director costs charged to the Coronavirus State and Local Recovery Funds program.