Finding Text
Criteria or Specific Requirement: In accordance with 2 CFR 200.302, non-federal entities must
maintain financial systems that provide for the identification, of all federal awards received and expended,
including revenues and expenditures tracked separately by federal program. Additionally, 2 CFR
200.430(i) requires that charges to federal awards for salaries and wages be based on records that
accurately reflect the work performed and must be supported by a system of internal control.
Condition and Context: During the audit, it was noted that Solvista Health did not ensure that an eligible
employee’s time was properly coded to the federal grant. Furthermore, the organization did not separately
track grant revenues and expenditures from its general operating funds, making it difficult to clearly
identify program-specific activity related to the federal award.
Questioned Costs: N/A
Cause: Solvista Health did not implement sufficient internal control procedures to ensure that employee
timecards were accurately coded to the appropriate grant, nor to ensure that grant revenues and
expenditures were tracked separately from general operating funds in accordance with grant and federal
requirements.
Effect: Failure to properly code eligible employee time to the appropriate grant and to separately track
grant revenues and expenditures increases the risk of unallowable activities and possible questioned costs.
Identification as a Repeat Finding: Not a repeat finding.
Recommendation: We recommend that Solvista Health implement internal controls over tracking of
expenditures related to federal award grants and the related reimbursed cost to ensure compliance with
federal requirements.