Finding 1206487 (2025-005)

Material Weakness Repeat Finding
Requirement
AB
Questioned Costs
-
Year
2025
Accepted
2026-04-13
Audit: 398537
Organization: Quincy Asian Resources, Inc. (MA)
Auditor: GRAY GRAY & GRAY

AI Summary

  • Core Issue: Payroll for April to June 2025 was charged to the grant without proper support from approved time sheets.
  • Impacted Requirements: Employees' hours billed cannot be verified due to reliance on budgeted payroll percentages instead of actual hours worked.
  • Recommended Follow-Up: Implement a time tracking system that mandates time sheet completion and requires approval for all hours worked.

Finding Text

Condition and Criteria: The payroll charged to the grant, relating to employees who are not 100% allocated to the grant, for April 2025, May 2025 and June 2025 could not be supported by approved time sheets. The payroll for these months were allocated based on payroll percentages from the budget instead of actual hours incurred by the employees. Questioned Cost: $56,212. Cause: Limitations of new time tracking system. Effect: It cannot be verified that the employees worked the hours billed to the grant. Auditor’s Recommendation: The Organization should use a time tracking system that requires employees to complete time sheets every pay period that encompasses both their federally funded and non-federally funded work. In addition, the system should provide for approvals of the employees’ time sheets by an appropriate person.

Corrective Action Plan

Views of Responsible Officials and Planned Corrective Action: While QARI concurs with the need for fully compliant time and effort documentation, the issue identified reflects limitations during the initial implementation of a new payroll system, not misuse of grant funds. QARI implemented a new payroll and timekeeping system in April 2025 to correct undercoding and allocation issues in the prior system. During the transition period (April–June 2025), payroll was allocated using budget-based percentages while staff clocked in and out and supervisors monitored work assignments to ensure time was spent on allowable grant activities. QARI’s internal review confirms that employees charged to the grant performed allowable and allocable work; however, the system configuration did not fully capture employee-level allocations by funding source during this implementation phase. Corrective actions include: 1) Reconstruction of manual timesheets for April–June 2025, supported by calendars and program records, with employee attestation and supervisory approval; 2) Reconfiguration of the payroll system to require employee self-allocation of actual hours worked each pay period; 3) Enhanced supervisory review and internal controls. The questioned costs reflect a temporary documentation gap during system transition, not unsupported or inappropriate expenditures. QARI has taken corrective action to ensure full compliance going forward.

Categories

Matching / Level of Effort / Earmarking

Other Findings in this Audit

  • 1206486 2025-004
    Material Weakness Repeat
  • 1206488 2025-006
    Material Weakness Repeat
  • 1206489 2025-007
    Material Weakness Repeat
  • 1206490 2025-008
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
93.988 COOPERATIVE AGREEMENTS FOR DIABETES CONTROL PROGRAMS $1.00M
10.225 COMMUNITY FOOD PROJECTS $106,613
97.010 Citizenship Education and Training $80,000