Finding Text
2024-003 INSUFFICIENT PAYROLL AUTHORIZATION AND TIMESHEET CONTROLS
Federal Agency: U.S. Department of Labor
Federal Program and Assistance Listing Number: 17.265
Type of Finding: Significant Deficiency, Non-compliance
Compliance Area: Allowable Costs (Payroll)
Award Period: National Employment and Training (07/01/2022-06/30/2025)
National Employment and Training (06/01/2023-06/30/2026)
Questioned Costs: None
Condition:
Our testing of payroll disbursements identified the following exceptions:
-One (1) out of 45 payroll transactions lacked supporting documentation for an approved pay rate change.
-One (1) out of 45 payroll transactions resulted in an overpayment for 52 hours instead of the authorized 20 hours.
Criteria:
Per 2 CFR §200.430 and NIYC's Fiscal Manual, all payroll transactions must be supported by appropriate documentation, including approved personnel action forms for rate changes and verified timesheets. Payroll must be reviewed and approved by designated personnel prior to processing.
Effect:
These deficiencies increase the risk of financial loss, inaccurate payroll reporting, and noncompliance with federal cost principles. They also undermine the reliability of internal controls over payroll processing.
Cause:
The overpayment was due to a clerical error in the Work Experience (WEX) timesheet process. The missing pay rate documentation was not retained during a period of organizational restructuring.