Finding 1216495 (2025-002)

Criteria or Specific Requirement According to §200.303 Internal controls of 2 CFR Part 200, the non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition and Context During our testing, we noted 1 sample where the Organization overpaid an individual which resulted in costs being erroneously allocated to the grant. Effect Noncompliance results in potential for incorrect payroll costs allocated to federal grants. Questioned Costs Known: $2,166 Cause Management oversight and improper payroll calculation. An employee was overpaid during their final payroll at the Organization. Recommendation We recommend the Organization update their termination procedures to verify that final payrolls are being calculated correctly and update their grant allocation process to ensure accurate wage rates are used to calculate the allocations. Views of Responsible Officials Management has updated the payroll termination process to include a documented review before payroll is finalized. The finance team will review final payroll calculations for terminated employees after HR provides the termination details and payout calculation. Payroll changes and review steps are documented as part of the bi-weekly payroll update emails.