Finding Text
Finding 2023‐002: Allowable costs – Material weakness over internal controls over compliance and compliance finding. Coronavirus State and Local Fiscal Recovery Funds ALN 21.027. Criteria: Section 200 of the Code of Federal Regulations requires recipients to have a cost allocation plan in place for allocated costs that is consistently followed and supported.
Condition: During allowable cost testing for federal grants, 19 out of 25 samples were not 100% charged to the grant and were not supported by a cost allocation plan for how the percentages charged to the grant were determined. Cause: Turnover in the Organization and lack of knowledge of allocated cost requirements. Recommendation: In order to comply with the Uniform Guidance federal regulations, we recommend a cost allocation methodology is put in place that is easy to follow and consistently applied throughout the year. In addition, support of all calculations should be kept on file to document how the allocation was determined. Management’s response: See corrective action plan.