Finding Text
Finding 2022-005: Insufficient Support for Costs Charged to Federal Award Programs Federal Agency: U.S. Department of the Treasury Assistance Listing Number: 21.027 Federal Program Name: Coronavirus State and Local Fiscal Recovery Funds Pass-through Entity: Snohomish County Human Services Pass-through Award Number: EL-22-AR-11-394 Criteria: Under 2 CFR 200.334, financial records and other supporting documents must be retained for a period of three years from the date of the submission of the annual financial report. Condition: Invoices, check copies, and other source documents could not be located to support the allowability of the costs charged to the major federal award program. Cause: The Organization had limited management and administrative staff and did not utilize a formal recordkeeping system during the year ended December 31, 2022. Further, as described in finding 2022-001, there were no written policies and procedures in place. Effect: Inadequate source documentation for costs charged to federal award programs may lead to findings in monitoring performed by oversight agencies and potential disallowed costs and/or decreases in future federal funding. Questioned Costs: Source documents could not be located for costs totaling $99,444, which represents 50% of our sample of transactions tested. Recommendation: We recommend that management implements and follows a formal record retention policy and retains receipts, invoices, and other source documents for costs charged to federal awards for a period of at least three years from the date the final financial report is submitted. Views of Responsible Officials: There is no disagreement with the finding.