Finding 1151734 (2024-005)

Significant Deficiency
Requirement
AB
Questioned Costs
$1
Year
2024
Accepted
2025-08-29

AI Summary

  • Core Issue: CFSC lacks adequate internal controls for payroll, leading to discrepancies in employee time records.
  • Impacted Requirements: Compliance with 2 CFR 200.403(a) regarding allowable costs and activities is affected.
  • Recommended Follow-Up: Implement a more thorough review process for time entries to ensure accurate payroll processing and prevent future discrepancies.

Finding Text

Federal Agency: United States Department of Agriculture, Forest Service Federal Program Name: Cooperative Forestry Assistance Assistance Listing Number: 10.664 Federal Award Identification Year: 2021 Pass-Through Agency: N/A Award Period: 09/01/21-08/31/26 Compliance Requirement Affected: Allowable Costs & Activities (Payroll) Type of Finding: Significant Deficiency in Internal Control over Compliance and Nonmaterial Noncompliance Criteria: 2 CFR 200.403(a) - Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. Condition: For five hourly employees, CFSC performed a review of payroll discrepancies occurring between 2020- 2024, due to differences when comparing time recorded on time sheets to time recorded to payroll, which resulted in a non-significant payment made to back to the employees. Questioned Costs: The known questioned costs are $8,600. Context: A nonstatistical sample of 60 out of >250 employee pay periods were selected for testing for the Cooperative Forestry Assistance program. The condition noted above was identified during our procedures over CFSC’s payroll disbursements. Effect: CFSC's internal controls did not include thorough review of time entry when processing payroll, which can result in understatement of payroll expense. Cause: CFSC's internal controls did not include thorough review of time entry when processing payroll.

Categories

Questioned Costs Allowable Costs / Cost Principles

Other Findings in this Audit

  • 575289 2024-002
    Material Weakness Repeat
  • 575290 2024-003
    Material Weakness Repeat
  • 575291 2024-004
    Material Weakness
  • 575292 2024-005
    Significant Deficiency
  • 1151731 2024-002
    Material Weakness Repeat
  • 1151732 2024-003
    Material Weakness Repeat
  • 1151733 2024-004
    Material Weakness

Programs in Audit

ALN Program Name Expenditures
11.473 Office for Coastal Management $1.31M
10.664 Cooperative Forestry Assistance $333,441
10.698 State & Private Forestry Cooperative Fire Assistance $11,044
15.228 Blm Fuels Management and Community Fire Assistance Program Activities $1,746