Finding Text
Federal Agency: U.S. Department of Veterans Affairs
Federal Program Name: Supportive Services for Veteran Families
Assistance Listing Number: 64.033
Federal Award Identification Number and Year: 12-NC-050
Award Period: September 30, 2022 through September 30, 2024
- 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 Corporation received reimbursement for the full amount of an expenditure, which included sales tax which they received a reimbursement for from the State.
Questioned costs: $324
Context: During our testing of 60 samples, we noted 6 item for a $324 expenditure that incorrectly charged sales tax the grant. Extrapolated to the entire population, an estimated $4,251 of expenditures would be incorrectly applied to the grant. Management has asserted this is the only instance of this issue.
Cause: The Corporation 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 Corporation review the expenditures submitted to Supportive Services for Veteran Families and ensure that there is no "double dipping” of sales taxes.
Views of responsible officials: Management agrees with the above finding. Within 60 days of audit issuance, the Interim CFO will conduct training for finance staff regarding accounts payable invoices and sales tax requirements and coding. Updated accounts payable policies and procedures include a process to ensure that the CFO reviews and codes sales tax when checks are prepared, approved and signed.