Finding Text
Federal Program: Workforce Investment Opportunity Act Cluster Assistance Listing 17.258 WIOA Adult Program Assistance Listing 17.259 WIOA Youth Activities Assistance Listing 17.278 WIOA Dislocated Worker Formula Grants Pass-Through Entity Identifying Number: 05-P19-Youth-81/05-P20-Youth-81 05-F20-Adult-81/05-F21-Adult-81/05-F22-Adult-81 05-F20-DLW-81/05-F21-DLW-81/05-F22-DLW-81 Federal Agency: U.S. Department of Labor Criteria or specific requirement: Subrecipient Monitoring (2 CFR 200.331 and 20CFR 683.210) and Activities Allowed or Unallowed (2 CFR 200, Subpart E) – Management is responsible for ensuring compliance with certain provisions of laws, regulations, contracts, and grant agreements. Condition: An ongoing investigation by a state agency on the WIOA program for the 2022 program year (fiscal 2023) has alleged a potential violation of operating under an expired legal contract with a subrecipient for over 10 months. Additionally, the election of the 10% de minimis indirect cost rate has not been implemented. Cause: Proper allowable costs policies and procedures were not in place according to the state agency. Effect or potential effect: The noncompliance could have a direct and material effect on the financial statements. Questioned Costs: $0 Context: The Organization operated without a legally binding agreement for WIOA Title I and One-stop Operator Services for over 10 months after the expiration of the previous contract. In addition, there was not sufficient documentation to support the allocation basis for certain expenditures charged to WIOA. Identification as a Repeat Finding, if Applicable: Yes - see prior year finding 2022-002. Recommendation: We recommend the Organization strengthen controls and processes related to the allowable costs policies and procedures. Views of Responsible Officials and Planned Corrective Actions: Management is considering its options for further appeals to the Department of Labor for review.