Finding Text
Finding Number 2024-004: Costs Incurred Outside Period of Performance (Significant Deficiency in Internal Control over compliance and Instance of Noncompliance – Period of Performance)
FALN Number 16.575; Federal Agency/Pass-through Entity – Program Name U.S. Department of Justice, Office of Victims of Crime – Crime Victim Assistance; Award Number 94-3302014; Award Year 2023-2024
Criteria: 2024 Compliance Supplement and 2 CFR 200.403(h) stated that a non-federal entity may charge only allowable costs incurred during the approved budget period of a federal award’s period of performance.
Condition/Context: As a result of our audit procedures, we noted 1 timesheet tested in which the costs incurred were charged outside of the program’s performance period. The timesheet had payroll costs incurred during the pay period of 12/24/2023 – 1/6/2024; however, the contract had a performance period of 1/1/2024 – 12/31/2024.
Repeat Finding from Prior Year(s): Yes, Finding Number 2023-007
Cause and Effect: The Health System did not have proper controls in place to ensure only costs incurred in the period of performance were charged to the program, which resulted in costs outside of period of performance being charged to the program.
Questioned Cost: None
Recommendation: We recommend management review policies and procedures of the program to ensure the costs incurred are appropriately charged based on the contracts’ performance periods.
Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding. The Health System has finalized the standard work procedure titled, Request for Funds/Reimbursement Claims (2-201’s), to ensure costs are appropriately charged based on the contract’s performance periods. Review of cost activity will occur in fiscal year 2025 to ensure policy is followed.