Finding Text
Significant deficiency in internal controls over compliance related to period of performance. Federal Agency: Department of Housing and Urban Development Program Title: Continuum of Care Assistance Listing Number: 14.267 Award Number: OR0214L0E012207; OR0214L0E012308; OR0215L0E012207; OR0215L0E012308 Award Period: September 1, 2023 - August 31, 2024; September 1, 2024 - August 31, 2025; September 1, 2023 - August 31, 2024; September 1, 2024 - August 31, 2025 Criteria Per the standards contained in Title 2 US Code of Federal Regulation Uniform Administrative Requirements, Cost Principles and Audit Requirements for Federal Awards, Subpart D - Post Federal Award Requirements, Section 200.309, only allowable costs incurred during the period of performance may be charged to the federal award. Condition/Context for Evaluation During our audit, from a sample of 25 transactions tested for period of performance, we identified two instances where the cost was incurred either before or after the respective award’s period of performance. In both instances the charges were related to payroll costs which were not accrued to the applicable award for when the services were rendered. Identified charges incurred outside the period of performance totaled $2,682 in the sampled population and total payroll charges determined to be outside of the period of performance were $4,691. Effect or Potential Effect The League charged to the federal award costs incurred outside the period of performance. Cause The League’s controls did not operate effectively to prevent or detect expenditures that were incurred outside of the federal award’s period of performance. Questioned Costs N/A Repeat Finding Yes Recommendation We recommend the League strengthen its internal control processes and procedures to ensure there are adequate controls in place to record payroll charges in the correct period to prevent charges to federal awards that did not occur within the award’s period of performance. Views of Responsible Officials of Auditee Management concurs with the finding and has provided the accompanying corrective action plan.