Finding 1156481 (2024-006)

Criteria: Allowable Costs - In accordance with the terms of the contract hourly rates in contracts are limited without prior approval. Condition: During allowable cost testing, it was noted that one of the contracts with the vendors included a rate that exceeded the rate cap without prior approval. Upon inquiry no prior approval was obtained. Cause: Mission Edge does not have policies and procedures in place that allow it to comply with specific terms and conditions of agreements. Effect: Purchases were made that did not comply with the grant agreement which resulted in non-compliance with program terms and conditions. Questioned costs: It was calculated that costs incurred in 2024 under this contract exceeding the approved rate totaled approximately $26,000. Context: This appears to be a systemic issue. Repeat finding: No Recommendation: Management should develop procedures that will provide reasonable assurance that specific terms and conditions of grant agreements are followed and complied with. Views of responsible official and planned corrective action: Management’s response is reported in “Management’s View and Corrective Action Plan” included at the end of this report.