Finding Text
2024-002 — Allowable Costs/Cost Principles Federal program information: Funding agency: U.S. Department of Health and Human Services Title: Indian Self-Determination, Medical Assistance Program ALN: 93.441, 93.778 Award period: 1/1/2024 – 12/31/2026, 1/1/2024 – 12/31/2024 Criteria: According to 2 CFR Part 200.403, to be allowable under federal awards, costs must be adequately documented. Additionally, the 2 CFR Part 200.430 requires that charges to Federal awards for salaries and wages must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Condition: Employee benefits expenditures charged to the programs do not agree to supporting documentation, such as employee benefit provider premium invoices. Context: All employee benefits charged to the programs. Questioned Costs: Undeterminable Cause: The payroll module and account structure setup in the accounting system (multiple benefits going into one benefit account) made it virtually impossible to reconcile employer benefits to the employer benefits provider premium invoices and/or employee benefit election forms. Effect: ABHS may not be able to demonstrate that the costs charged to federal programs are allowable. Auditor’s Recommendations: ABHS should implement a reconciliation process to ensure that employee benefit expenditures charged to federal programs agree with employee benefit provider premiums invoices and/or employee benefit election forms. Management’s Response: ABHS has implemented a new accounting and payroll system which allows the organization to reconcile employee benefit expenditures monthly. These systems were implemented in March and April of 2025 and management expects this finding to be resolved in 2025.