Finding Text
Finding 2024-3 Internal Controls over Compliance with Activities Allowed or Unallowed Requirement (Significant Deficiency)
Identification of the federal program(s):
Assistance Listings program titles and numbers:
21.027 Coronavirus State and Local Fiscal Recovery Funds
93.558 Temporary Assistance for Needy Families (TANF)
Federal award identification number:
21.027: City of Columbus (award number not provided), Future Ready Five (award number not provided), Franklin County Department of Job and Family Services Award Number 25-22-3647
93.558: Ohio Department of Job and Family Services Award Numbers G-2425-17-0058; Franklin County Department of Job and Family Services Award Numbers 25-23-3662, 25-23-5698, 25-24-5859
Name of the federal agencies:
21.027 Department of the Treasury
93.558 Department of Health and Human Services
Name of the applicable pass-through entities:
21.027: City of Columbus, Future Ready Five, Franklin County Department of Job and Family Services
93.558: Ohio Department of Job and Family Services and Franklin County Department of Job and Family Services
Criteria or specific requirement (including statutory, regulatory, or other citation): The 2 CFR section 200.303 of the Uniform Guidance requires that non-federal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the non-federal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards.
Condition: During the audit, it was noted that AFC was unable to provide journal entry approval for payroll charges for 20 out of 25 selections for both federal programs (20 each, 40 total) due to a recent change in the accounting system where approvals were not retained. During the audit, it was noted that the AFC was unable to provide invoice approvals for 5 out of 25 non-payroll charges to the 93.558 program and 3 out of 25 non-payroll charges related to the 21.027 program.
Cause: The change in the accounting system led to disruptions in the documentation process, resulting in the inability to retrieve documentation of approval records for payroll and non-payroll charges to the federal programs.
Effect or potential effect: Without adequate internal controls in place to ensure that all charges to the federal program are properly reviewed for allowability, AFC could be noncompliant with the allowability requirement and could request funds for costs that are unallowed.
Questioned costs: None
Context: AFC’s policies and procedures require that all payroll costs and non-payroll costs charged to federal awards must be supported by adequate approval documentation that demonstrates the allocability, allowability, and reasonableness of the expenses.
Identification as a repeat finding, if applicable: Not applicable
Recommendation: We recommend that AFC retain all approved documents related to charges to the federal programs.
Views of responsible officials: Management agrees with the finding and recommendation.