Finding 1105621 (2024-003)

Material Weakness
Requirement
AB
Questioned Costs
$1
Year
2024
Accepted
2025-03-20
Audit: 347167
Organization: Oregon Food Bank, Inc. (OR)
Auditor: Moss Adams LLP

AI Summary

  • Core Issue: The Organization lacks proper documentation for payroll expenses, relying on estimates instead of actual work records.
  • Impacted Requirements: This violates 2 CFR §200.430(g), which mandates accurate records and internal controls for federal salary charges.
  • Recommended Follow-Up: Implement a time and effort reporting system to ensure compliance and accurate tracking of personnel expenses.

Finding Text

Criteria – 2 CFR §200.430(g) – Standards for Documentation of Personnel Expenses require that charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed and are supported by a system of internal control which provides reasonable assurance that charges are accurate, allowable, and properly allocated. Estimates determined before services are performed do not qualify as support. Condition/context – A sample of 9 payroll expenditures was selected for testing. The total population of payroll expenditures charged to the food distribution cluster grants was $1,396,059. For all 9 selections, the Organization was unable to provide evidence of actual time spent on each grant. The Organization allocates personnel expenses to federal awards using estimates, not records that accurately reflect the work performed. The Organization estimates how much time each employee spends on activities allowable for each grant, but these estimates are not supported by records that reflect the work performed. The Organization has an electronic timekeeping system, but the system does not track the activities an employee performs. Employees are not required to complete certifications or Personnel Activity Reports (PARs) to support the hours worked on allowable activities. Our sample was not, and was not intended to be, statistically valid. Questioned costs – ALN 10.565 - $8,192, ALN 10.568 - $1,323,021, ALN 10.182 - $64,846 Total questioned costs for all programs – $1,396,059, which is the total payroll expenditures charged to the food distribution cluster grants. Cause/effect – The Organization has not developed a system of internal control which provides reasonable assurance that charges are accurate, allowable, and properly allocated. Personnel expenses charged to federal awards are not supported by records that reflect the work performed. Repeat finding – No. Recommendation – We recommend the Organization establish a system of time and effort reporting that meets the standards for documentation of personnel expenses, and a system of internal control that provides reasonable assurance that the charges are accurate, allowable and properly allocated.

Categories

Questioned Costs Reporting Internal Control / Segregation of Duties

Other Findings in this Audit

  • 529179 2024-003
    Material Weakness
  • 529180 2024-003
    Material Weakness
  • 529181 2024-003
    Material Weakness
  • 529182 2024-004
    Significant Deficiency
  • 529183 2024-004
    Significant Deficiency
  • 529184 2024-004
    Significant Deficiency
  • 529185 2024-004
    Significant Deficiency
  • 529186 2024-004
    Significant Deficiency
  • 529187 2024-005
    Significant Deficiency Repeat
  • 529188 2024-005
    Significant Deficiency Repeat
  • 529189 2024-005
    Significant Deficiency Repeat
  • 529190 2024-005
    Significant Deficiency Repeat
  • 529191 2024-005
    Significant Deficiency Repeat
  • 1105622 2024-003
    Material Weakness
  • 1105623 2024-003
    Material Weakness
  • 1105624 2024-004
    Significant Deficiency
  • 1105625 2024-004
    Significant Deficiency
  • 1105626 2024-004
    Significant Deficiency
  • 1105627 2024-004
    Significant Deficiency
  • 1105628 2024-004
    Significant Deficiency
  • 1105629 2024-005
    Significant Deficiency Repeat
  • 1105630 2024-005
    Significant Deficiency Repeat
  • 1105631 2024-005
    Significant Deficiency Repeat
  • 1105632 2024-005
    Significant Deficiency Repeat
  • 1105633 2024-005
    Significant Deficiency Repeat

Programs in Audit

ALN Program Name Expenditures
10.569 Emergency Food Assistance Program (food Commodities) $24.91M
10.568 Emergency Food Assistance Program (administrative Costs) $3.05M
10.182 Pandemic Relief Activities: Local Food Purchase Agreements with States, Tribes, and Local Governments $2.44M
10.331 Gus Schumacher Nutrition Incentive Program $1.21M
10.187 The Emergency Food Assistance Program (tefap) Commodity Credit Corporation Eligible Recipient Funds $665,503
10.565 Commodity Supplemental Food Program $495,889
21.027 Coronavirus State and Local Fiscal Recovery Funds $177,939
97.024 Emergency Food and Shelter National Board Program $175,055
10.561 State Administrative Matching Grants for the Supplemental Nutrition Assistance Program $129,411
10.177 Regional Food System Partnerships $55,344