Finding Text
2024-002 Internal Controls over Expenditures Charged to Federal Award for U.S. DHHS 93.432 ACL Centers for Independent Living #2201MEILCL-00 (Significant Deficiency in Internal Controls over Compliance and Noncompliance) Criteria: Management is responsible for the design and implementation of internal controls over expenditures charged to federal award programs.
Condition and Context: Through audit procedures testing internal controls over cash disbursements charged to major federal award programs, one expense lacked readily available support and 2 expenses did not have documented approval.
Cause: There is shortage of staffing in the finance department and lack of sufficiently documenting procedures to save employees’ time.
Effect: Total expenditures charged to the federal award program were inaccurate.
Questioned Costs: Expenses charged to major federal award programs for which there was not readily available support or approval of expenditures was not documented totaled $558.
Recommendation: Procedures should be implemented requiring documentation be maintained to support every expense charged to federal programs including documentation of approval of expenditures.
Views of Responsible Officials and Planned Corrective Actions: Management agrees with the audit findings and has already taken immediate corrective action by re-training accounting staff on the importance of maintaining all supporting documentation and obtaining the necessary approvals before processing any cash disbursements. To further strengthen internal controls, management is exploring the implementation of a system upgrade that would automate the documentation and approval process for expenditures charged to federal award programs.