Finding Text
Finding No. 2024-001
Federal Agency: Department of the Treasury
Federal Program Name: Coronavirus State and Local Fiscal Recovery Funds
Listing Number: 21.027
Federal Award Identification Number and Year: 22GOV0019AA, 2024
Pass-Through Agency: Town of East Hartford, State of Connecticut Office of Workforce Strategy, City of Hartford
Pass-Through Number: SLFRP0128
Award Period: 2024
Type of Finding:
- Material Weakness in Internal Control over Compliance
- Material Noncompliance (Modified Opinion)
Criteria: 2 CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Award requires compliance with the provisions of allowable costs. ReadyCT, Inc. should have internal controls designed to ensure compliance with those provisions.
Condition: During our testing, it was noted that the organization does not have a standard policy requiring the preparation of time sheets or personal activity reports (PAR) for all employees on a monthly basis that are signed off on by the employee and the supervisor.
Questioned costs: Unknown
Context: ReadyCT, Inc. is charging to the award based on the budgeted payroll expenses which does not correspond with the actual salary expense that should have been allocated to the award. Salaries and benefits charged to this award represent approximately 72% of total award expenditures and 22% of total salaries and benefits costs incurred by the organization for the fiscal year ending June 30, 2024. While costs charged to the award for salaries and benefits did not exceed the established budget, without supporting activity reports or time sheets, it is unknown if the employees charged to the award should have been.
Cause: Management believed that they should charge the award based on budget, updated periodically for changes in awards or personnel. There was no formal documentation of employee and supervisor approval of the amounts allocated to the award.
Effect: The effect is that salaries charged may not represent the award's allocable share.
Repeat Finding: No
Recommendation: ReadyCT, Inc. should formalize a process of employee documentation of time and effort for the award as well as supervisor review over allocations to the award to ensure that allocations are based on actual time and effort.
Views of Responsible Officials: Management concurs with the finding. See separate corrective action plan.