Finding 1130639 (2024-002)

Significant Deficiency
Requirement
AB
Questioned Costs
-
Year
2024
Accepted
2025-04-05

AI Summary

  • Core Issue: The Organization improperly charged sales tax to the federal grant, indicating a significant deficiency in internal controls over compliance.
  • Impacted Requirements: This violates 2 CFR 200.406, which mandates that any credits related to allowable costs must be credited to the federal award.
  • Recommended Follow-Up: The Organization should review all submitted expenditures to ensure no "double dipping" of sales taxes occurs in future claims.

Finding Text

Federal Agency: Department of Health and Human Services Federal Program Name: Substance Abuse and Mental Health Services Projects of Regional and National Significance Assistance Listing Number: 93.243 Federal Award Identification Number and Year: 1H79SM087513-01 - 2024 Award Period: September 30, 2023 through September 29, 2027 Type of Finding: • Significant Deficiency in Internal Control over Compliance and Other Matters Criteria or specific requirement: Under 2 CRF 200.406, credits accruing to or received by the recipient of federal funding that relate to allowable costs must be credited to the Federal award as either a cost reduction or cash refund. Condition: During our testing, we noted the Organization received reimbursement for the full amount of an expenditure, which included sales tax which they received a reimbursement for from the State. Questioned costs: None Context: During our testing of 29 samples, we noted 1 item for a $96 expenditure that incorrectly charged sales tax of $6.30 to the grant. Extrapolated to the entire population, an estimated $8.86 of expenditures would be incorrectly applied to the grant. Management has asserted this is the only instance of this issue. Cause: The Organization did not have adequate internal controls designed to properly determine the appropriate amounts to be submitted for reimbursement. Effect: Noncompliance with the federal requirements around the determination of an eligible expenditure. Recommendation: We recommend the Organization review the expenditures submitted to SAMHSA and ensure that there is no "double dipping' of sales taxes. Views of responsible officials: There is no disagreement with the audit finding..

Categories

Allowable Costs / Cost Principles Cash Management Significant Deficiency Internal Control / Segregation of Duties

Other Findings in this Audit

Programs in Audit

ALN Program Name Expenditures
93.243 Substance Abuse and Mental Health Services Projects of Regional and National Significance $986,935
10.553 School Breakfast Program $45,517
10.555 National School Lunch Program $4,964