Finding Text
Condition: In review of budget to actual expenditure amounts for the year under audit, the auditor noted two line items that
exceeded the allowed budget amount for the year. While a budget amendment was completed for these line
items, one line still exceeded the allowable budget amount.
Criteria: Annual budgets are approved by the grantor agency and amendments must be submitted for approval to alter
the original budget if needed. Cause: For two line items, the original budget as approved was exceeded. Additionally, for one of those two line items,
even though an amendment was submitted, the budget was still exceeded. It appears that monitoring is not
sufficient to prevent budget overages from occurring, nor to detect them timely to rectify the grantor.
Effect: enCircle violated their grant terms by exceeding their approved budget.
Questioned Cost Amount: $886.24
Recommendation: Management should implement procedures that allow for proper reviews of budget to actual information for
grants to verify amounts expended and amounts remaining for expenditure monthly. Additionally, grant
management personnel and financial personnel need to work on better communication regarding financial status
of grants. Views of Responsible Officials and Planned Corrective Action: During the monthly billing process, enCircle will now only bill up until the approved budget even if there are
allowed costs, irrespective of budget, in excess of budget amounts. enCircle will then request a budget
amendment to allow for these costs and once approved include the previously unbilled costs in the next monthly
billing. Furthermore, enCircle will work to preemptively request budget amendments by forecasting allowed
expenditures.
enCircle will evaluate if the monthly meeting between grant management personnel and financial personnel
remains sufficient to ensure communication and grant compliance are adequate. If not, enCircle will change the
meeting cycle to create sufficient communication including other means (Teams chats, etc…)