Finding 1159797 (2024-005)

Material Weakness Repeat Finding
Requirement
AB
Questioned Costs
-
Year
2024
Accepted
2025-10-02
Audit: 370336
Organization: Program of Academic Exchange (NY)
Auditor: Rln US LLP

AI Summary

  • Core Issue: PAX's process only tracks employee effort for federal awards, leaving non-federal efforts undocumented.
  • Impacted Requirements: The lack of complete documentation fails to meet standards for tracking all employee time and effort across all programs.
  • Recommended Follow-up: Implement a system to capture and document all employee efforts, including non-federal programs, to ensure compliance.

Finding Text

PAX implemented a process under which employees sign off on their biweekly earnings statements to indicate the percentage of effort attributed to each federal award. However, this process captures only the effort associated with federal programs. The remaining portion of employee effort, relating to non-federal programs and management & general functions, is estimated by management on a monthly basis. As a result, the organization does not maintain employee-supported documentation reflecting 100% of time and effort worked across all cost objectives.

Corrective Action Plan

Based upon current auditor’s recommendation, PAX has revised its effort verification reporting system. The previous system recommended by the last auditor was launched in FY23, however, current auditor points out the need to track all efforts rather than only the federal grants in order to provide support for the full effort of each employee. Our latest revised system will accurately capture 100% of the effort spent by each employee on specific grants, other programs, and general and administrative functions, ensuring complete documentation of allocation of wages and salaries to the respective federal awards.

Categories

Matching / Level of Effort / Earmarking

Other Findings in this Audit

  • 1159795 2024-005
    Material Weakness Repeat
  • 1159796 2024-006
    Material Weakness Repeat
  • 1159798 2024-006
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
19.415 Professional and Cultural Exchange Programs - Citizen Exchanges $1.28M