Finding Text
Allowable Costs – Indirect Costs – Noncompliance Criteria – Indirect costs charged to federal programs must be calculated in accordance with the approved Indirect Cost Rate Agreement and applicable federal regulations. Condition and context – The Tribes charged $93,615 in indirect costs to the Indian Child Welfare Improvement Project program (ALN 16.583) from fiscal years 2019 through 2022. Based on the Tribes’ Indirect Cost Negotiation Agreement and their direct cost base for the program during this period, the maximum amount of allowable indirect costs that should have been charged to the program was $66,677. Questioned costs – The Tribes overcharged indirect costs to the program, resulting in questioned costs of $26,938. Cause – The Tribes calculated total indirect costs on total expenditures for the program without excluding capital expenditures as required by their Indirect Cost Negotiation Agreement. Effect – The overcharge resulted in questioned costs totaling $26,938, representing the amount by which indirect costs exceeded the allowable calculation. Repeat finding – This is not a repeat finding from the prior year. Recommendation – We recommend the Tribes implement procedures to review their indirect cost calculations for accuracy. The total direct cost base should be reduced by capital expenditures and passthrough funds in accordance with the approved Indirect Cost Rate Agreement. Views of responsible officials and planned corrective action: The Tribes, in collaboration with the Interim CFO, will review and verify indirect cost calculations to ensure accuracy and compliance with the approved indirect cost rate agreement.