Finding Text
Criteria or Specific Requirement: In accordance with 2 CFR 200.430, compensation for personal
services must be based on records that accurately reflect the work performed and must be supported by a
system of internal controls that provides reasonable assurance that the charges are accurate, allowable,
and properly allocated.
Condition: During the testing of federal expenditures, specifically over the accounting for payroll
expenditures submitted for reimbursement, we noted that payroll expenditures for one employee included
an additional month’s payroll costs attributable to a different employee covered under the same grant.
Context: Payroll expenditures were duplicated due to an accounting error, which overstated the payroll
expenditures applied to the grant.
Questioned Costs: $6,358 consisting of payroll expenditures duplicated during the July 2023 through
January 2024 reporting period.
Cause: The variance appears to have resulted from a lack of sufficient internal controls over the accurate
accounting and review of payroll costs charged to the federal program. In particular, Solvista Health did
not implement a process for the review and approval for the final payroll costs submitted for
reimbursement, which resulted in errors.
Effect: Failure to submit accurately accounted for payroll expenditures to the federal program, may result
in noncompliance with federal regulations over allowable costs, as well as questioned costs related to the
incorrect submitted payroll expenditures.
Identification as a Repeat Finding: Not a repeat finding.
Recommendation: We recommend that Solvista Health implement a system of internal controls that are
designed and operating to provide an accurate accounting of payroll costs incurred under the federal
programs, including review and monitoring of processes and procedures. In addition, documentation
ensuring accurate payroll costs allocated to federal programs, along with support of review and approval
of such charges, should be retained in accordance with federal regulations.