Finding Text
Finding #2023-004 Repeat Finding: No Condition: During the course of the audit, we noted employees use timesheets to track their time; however, approval of the timesheet by a supervisor could not be verified. Criteria: An effective control structure should be designed to ensure transactions are monitored and approved by designated personnel. Approval should be documented and verifiable. Cause: The Organization did not have the adequately designed procedures in place to document the independent review of the timesheet by a supervisor/manager. Effect: A significant deficiency in the Organization’s internal control exists. Context: In connection with the audit, we selected a sample of employees to verify the employee’s hours per the payroll register were supported by an approved timesheet. For the employees tested, we noted hours were supported by timesheets, including the hours charged to federal grants; however, we were unable to verify that the timesheets were approved by a member of management. Questioned Costs: None noted. However, the lack of documented internal controls could affect allowability of costs under federal awards in future periods. Recommendation: We recommend the Organization implement procedures to ensure timesheets are approved and establish a process for documenting the approval. Reporting Views of Responsible Officials: Management agrees with the finding. The Organization already has procedures in place requiring the employee’s direct supervisor to approve the timesheet weekly, but the approval is not documented. The Organization will modify and enhance its procedures so that approval can be verified and supported.