Finding 1238844 (2025-003)

2 CFR § 300.1 gives regulatory effect to the Department of Health and Human Services for 2 CFR § 200.430 which states, in part, charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must be supported by a system of internal control that provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Per the Belmont County Department of Job and Family Services, employees complete their timesheet which are turned into their supervisor. From the timesheets, the supervisors prepare a ‘Hours Reported for Pay Ending’ form for each pay period end date which shows the employee name, hours worked, hours at time and One-half, on-call pay, etc. The Fiscal Administrator will ‘checkmark’ the employee hours on the ‘Hours Reported for Pay Period Ending’ form to verify that the amount is correct and added to the payroll transmittal report. Evidence of this approval on the ‘Hours Reported for Pay Ending’ are necessary to acknowledge that the expenditures are allowable, per specific grant regulations, and are compliant with Uniform Guidance requirements contained in Subpart E of 2 CFR part 200. Due to the lack of the control procedures over the review of payroll reports, two out of sixty (3%) employees tested did not have overtime hours from their time sheets reported on the ‘Hours Reported for Pay Period Ending’ form, which resulted in an underpayment. This weakness could result in unallowable expenditures (employees) being charged to programs administered by the County Department of Job and Family Services. Formal written procedures should be developed, implemented, and consistently applied to the approval of federal grant expenditures prior to payment. Procedures should include how approvals by management or administrators are documented for each expenditure and the approvals should be done by personnel knowledgeable about the federal program and, for payroll expenditures, the actual work performed by employees. Implementing a formal control process with help ensure only allowable expenditures are made using federal grant funds and will ensure that employees are paid properly.