Finding Text
Finding 2024-006: Improve Documentation and Controls over Allowable Costs Federal Program(s) Information Federal Agency: Department of Education Cluster/Program: Special Education Cluster Award Name: Special Education Grants to States and Special Education Preschool Grants Assistance Listing Number: 84.027/84.173 Award Year: 2024 Compliance Requirement: Activities Allowed or Unallowed, Allowable Costs/Cost Principles Type of Finding - Compliance Internal Control over Compliance – Material Weakness Criteria or Specific Requirement Per Uniform Guidance (2 CFR § 200.430), charges to federal grants for salaries and wages must be based on records that accurately reflect the work performed. Time and effort documentation—such as personnel activity reports, after-the-fact certifications, or properly maintained timesheets for hourly employees—must support that the amount charged to the grant is allocable and appropriate. Condition and Context Of the 40 payroll selections tested for the Special Education Cluster, 28 lacked required time and effort documentation to support the time worked on the grant. In addition, for 21 hourly employees, timesheets were not maintained, preventing verification that only hours spent on grant functions were charged to the grants. Cause The Town did not have effective controls in place to ensure required time and effort documentation and timesheets were completed and retained for all employees whose salaries or wages were charged, in whole or in part, to federal grant programs. Effect or Potential Effect Lack of proper time and effort support and failure to maintain timesheets for hourly employees increases the risk of unallowable or unsupported costs being charged to the grants, resulting in material noncompliance and the potential for disallowed costs. Questioned costs are reported as follows: AL Number(s): Name of Federal Program or Cluster Questioned Costs 84.027/84.173 Special Education Cluster $1,251,490 Recommendation The Town should implement and enforce procedures to ensure all employees whose salaries or wages are charged to federal grants maintain and retain appropriate time and effort documentation, including timesheets for hourly staff and semi-annual certifications for salaried staff, in compliance with Uniform Guidance. Views of Responsible Official See corrective action plan included herein.