Finding Text
Finding No. 2024-001: Activities Allowed or Unallowed and Allowable Costs/Cost Principles – Material Weakness
Federal Program Name: All
Pass-through Entity: All
Federal Assistance Listing Number: All
Criteria
Title 2 U.S. Code of Federal Regulations Part 200 includes the requirement that charges to federal awards for salaries and wages be based on records that accurately reflect the work performed. These records must support the distribution of the employee’s salary or wages among specific activities or cost objectives.
Condition
The Organization was unable to produce records supporting the work performed or support the distribution of wages.
Cause
The Organization’s charges to federal awards for salaries and wages are not supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated, and that reasonably reflect the total activity for which the employee is compensated.
Effect
The basis for allocating costs to federal awards is unsupported by documentation.
Questioned Costs
Unknown.
Context
There is no support, such as a time sheet or personnel activity report, for the allocation of wages charged to federal awards.
Recommendation
We recommend that the Organization develop, implement and maintain a system of internal controls to support the proper tracking and allocation of wages to federal awards.
Management’s Response/View of Responsible Officials
Management agrees with this finding, see the Corrective Action Plan.