Finding Text
Criteria:The Services and TransitionalHousingforTraffickingVictimsprogramrequires thatcosts chargedto theFederalaward shallbeallowable and supportable in accordancewith 2CFR§ 200.403.Adequate sourcedocumentationmustberetainedtosupportreimbursedcosts. Condition: During the audit, it was noted that 4.5 hours of overtime for an employee were not processed in payroll. The discrepancy appears to have resulted from either a data entry error in the payroll system or the system failing to save the entered hours. As a result, the employee was not paid for the overtime worked. As reimbursed payroll amounts were lower than the actual costs incurred, no questioned costs were identified. Cause: The procedures for payroll review and processing were not followed to ensure payroll is properly accounted for and processed. The lack of proper review represents a failure to fully comply with payroll processing requirements and procedures leading to inaccurate employee compensation and program reporting. Questioned Cost: $-0- Effect: The lack of formal review, approval, and reconciliation of the payroll process led to an employee not being originally paid for the overtime worked and an inaccurate payroll amount being reimbursed. However, the overall payroll expenditures were lower than the amount reimbursed by the program as a result of the error and did not lead to excess funds provided. Recommendation:We recommend managementcontinuetoemphasizethepayrollcontrols byensuring allhours,includingovertime,are accurately entered,reviewed,and verifiedin thepayrollsystem.Managementshould implementa formalreviewprocess to reconcile payrollentries againsttimesheets priortoprocessingandensure thatthesystem properly savesallentries.Ongoingtrainingforaccounting personneland periodic audits ofpayrolldatacanfurtherreducetherisk oferrors and ensurecompliance with payrollprocessingrequirements. Classification:Compliancefindingandcontroldeficiency in internalcontrols