Finding Text
2025-002: Allocation of Costs Other Than Payroll Criteria or specific requirement: In accordance with Title 2 U.S. Code of Federal Regulations (CFR) Part 200.414, the Alliance must allocate indirect costs appropriately. Condition and context: The Alliance allocates certain shared costs, other than payroll, using an approach that details the full-time equivalents performing work on each grant. During the year ended June 30, 2025, costs were allocated using a schedule that did not agree to actual underlying payroll data. Cause: The NetSuite program, used to ensure that the proper allocations were used, was not reviewed for an error in the program that did not adequately account for the addition of new grants which slightly changed some allocations of space costs Effect or potential effect: Without adequate controls over this process, the Alliance could incorrectly charge costs to federal grants. Questioned costs: None. Identification as a repeat finding, if applicable: This is a repeat finding. Recommendation: The Alliance should ensure that internal control processes for the allocation of costs are consistently followed. A review process should be in place to ensure that accurate allocations are used. During the fiscal year ending June 30, 2025, the Alliance has implemented the use of the de minimis cost rate, which will alleviate the need to create an allocation approach for shared costs. Views of responsible officials: Refer to the Corrective Action Plan prepared by the Alliance in regard to this matter.