Finding Text
Criteria: Workforce Innovation and Opportunity Act (WIOA) Adult and Dislocated Worker funds must be used at the local level to pay for career and training services through the AJC system for program participants. Other activities allowed include basic career services, individualized career services, and training services. Activities allowed under Youth Activities include tutoring, alternative secondary school services, paid and unpaid work experiences, occupational skill training, leadership development, adult mentoring, follow-up services, financial literacy education, and entrepreneurial skills training. 2 CFR 200.403 Factors affecting allowability of costs. Except where otherwise authorized by statute, costs must meet the following criteria to be allowable under Federal awards: (a) Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. (g) Be adequately documented. See §§ 200.300 through 200.309. 2 CFR 200.303 Internal Controls (a) Establish, document, and maintain effective internal control over the Federal award that provides reasonable assurance that the recipient or subrecipient is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should align with the guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control- Integrated Framework” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Workforce Innovation and Opportunity Act (WIOA) Funds were expended for costs that are not explicitly allowable under the compliance requirements for activities allowed or unallowed including charges for conferences and travel. • Travel and conference expense reimbursements did not establish a clear business purpose or provide other evidence of attendance. Receipts lacked a detailed breakdown of costs charged to the federal award. • Employee reimbursements did not include itemized breakdowns and were not reported on the entity’s Expense Form. • The entity’s policy does not outline the approval requirements for Executive Director expense reimbursements. Cause: Employee expenditures were not reviewed and approved prior to being charged to the federal award program. • The necessary approvals were not obtained prior to incurring costs charged to the federal award program. • The entity’s policy does not explicitly state approvals required for Executive Director expense reimbursements. • Expense Forms were not utilized for employee reimbursements per the entity’s written policy. Effect: Lack of proper approvals and documentation could result in unallowable costs being charged to the federal award, possibly resulting in the entity having to return funds to the federal agency or pass-through entity. This may also lead to reduction of future federal funding due to noncompliance. This also creates an opportunity for fraud to occur. • Unnecessary or unreasonable costs charged to the federal award program. • Possible reduction of future funding or requirement to return funding used for unallowable costs to awarding agency. Questioned Costs: $14,548 Repeat Finding: No Recommendation: We recommend that management review policies over employee travel expenses, conferences, and reimbursements to ensure they align with federal award requirements, are communicated to all employees, and provide necessary training. In addition, we recommend the WIB ensure that all employee reimbursement expenses are reviewed and approved prior to being incurred, approvals are obtained by an appropriate level of management or those charged with governance and are sufficiently documented.