Finding Text
Criteria
Uniform Guidance Subpart E §200.430 contains the federal regulatory requirements for internal controls over certifying time expended on sponsored awards. The College’s practice is to utilize an after‐the‐fact effort reporting system to certify that salaries charged, or cost‐shared to sponsored awards, are reasonable and consistent with the work performed. Section §200.430(c) states, “It is recognized that teaching, research, service, and administration are often inextricably intermingled in an academic setting. When recording salaries and wages charged to Federal awards for IHEs (Institutions of Higher Education) a precise assessment of factors that contribute to costs is therefore, not always feasible, nor expected.”
Condition
During our testing of payroll disbursements as part of allowable cost compliance testing, we identified one employee whose time was not accurately allocated to the grant program for the period of July to September 2023. The employee’s time and effort was inadvertently allocated at a rate of 75% when it should have been allocated fully at 100% of hours worked for that portion of the grant period.
Cause
The employee’s profile in the Massachusetts state accounting system was inadvertently set up with the incorrect employee’s time and effort allocation. The employee was coded time and effort of 75% instead of the 100% they should have been, causing an underreporting of expenditures charged to the grant.
Effect
Incorrect time and effort allocations can result in over or underreporting of related expenditures to a federal grant program.
Questioned Costs
The identified error resulted in a total of $5,590 in salary costs that were not properly charged to the grant program.
Perspective
Our sample was not, and was not intended to be, statistically valid. Of the 40 payroll disbursements sampled, 5 disbursements related to the same employee had incorrect time and effort allocations applied to the grant.
Identification as a Repeat Finding, if applicable
Not applicable
Recommendation
We recommend the College review monthly grant expenditures alongside certifying employee time and effort to ensure personnel costs are accurately recorded to federal grant programs.
View of Responsible Officials
The discrepancy was identified, and the personnel profile was corrected in fiscal year 2024. The corrective action has already been implemented as per the above guidance to avoid any future error in effort allocation.