Finding 1080051 (2024-004)

Significant Deficiency 2024-004 Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) – 93.323 Activities Allowed or Unallowed and Allowable Costs and Cost Principles Criteria or specific requirement In accordance with 2 CFR 200.430, payroll charges should be supported by proper documentation that reflects the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on a Federal award and non-Federal award. In addition, in order to ensure that employees are paid the correct amount and that no conflict of interest may occur, internal controls should be put in place to ensure that all wage rates paid have been approved by the Board. Condition Three employees were paid an additional amount using program funding in order to reflect the administrative burden associated with running the program for three years. For two of the employees, no personnel activity reports or other time records could be provided to support those costs. For the third employee, a monthly log of hours worked on grant activities was provided. However, it only showed the total hours for that month and did not break them out by date of occurrence. Additionally, no supervisor review or other control over that log occurred. Lastly, the employees’ contracts were not amended and approved by the Board to reflect these additional amounts. Context We determined, through testing of program expenditures, that $16,162 was paid in gross wages and taxes for the three employees. Cause District employees do not have a significant amount of experience with large federal programs, and they were not aware of the compliance requirements. Effect Proper records were not maintained to support program expenditures. Recommendation Employees with grant administration responsibilities should undergo training to better their understanding of the compliance requirements that accompany Federal programs. Additionally, controls should be implemented to ensure that all required records are prepared, as well as to ensure that the Board approves all wage rates. Views of responsible officials See corrective action plan.