Finding Text
Federal Agency: U.S. Department of Health and Human Services Federal Program Name: Special Programs for the Aging, Title III, Part C, Nutrition Services; Nutrition Services Incentive Program Assistance Listing Number: 93.045; 93.053 Federal Award Identification Number and Year: DA24-00030 (2024 Pass-Through Agency: City of Seattle Human Services Department Pass-Through Number(s): DA24-00030-A2 Award Period: January 1, 2024 through December 31, 2027 Type of Finding: Significant Deficiency in Internal Control over Compliance – Activities Allowed or Unallowed and Allowable Costs/Cost Principles Other Matters – Non-Compliance with Activities Allowed or Unallowed and Allowable Costs/Cost Principles Compliance Requirements Criteria or specific requirement: Per the OMB UG 200.430(g)(1), "charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must (i) be supported by a system of internal control that provides reasonable assurance that the charges are accurate, allowable, and properly allocated." Condition: One selected payroll expense was recorded with an incorrect proportion of employee time coded to the Federal program code. Questioned costs: Questioned costs do not exceed the reportable threshold. Context: For payroll, an incorrect allocation percentage was used. The Senior Accountant tasked with payroll explained that when she calculated the December allocation between two employees, the combined gross pay amount was used as the basis for the percentage calculation instead of using the individual gross pay amounts. Cause: The payroll exception resulted from an error in calculating the allocation percentages and was not identified through the review process. Effect: Payroll was not recorded with the correct allocation amount with support underlying documentation. Repeat Finding: No. Recommendation: Management at Sound Generations should review its existing control structure and ensure that there are adequate processes and controls to ensure payroll is allocated correctly for Federal programs, in accordance with the underlying supporting documentation, and that only allowable costs are included in the allocation pool. Views of responsible officials and planned corrective actions: Please see the attached Management’s Corrective Action Plan.