Finding Text
Finding 2025-003 Material Weakness in Internal Control Over Allowable Costs/ Cost Principles Assistance Listing Numbers 93.959 Block Grants for Prevention and Treatment of Substance Abuse 93.958 Block Grants Block Grants for Community Mental Health Services Federal Agency U.S. Department of Health and Human Services, Health Resources and Services Administration Passthrough Agency Illinois Department of Human Services Award Year 2025 Criteria HSI is responsible for keeping adequate supporting documentation of salaries and wage expense charged to federally funded grants. Required documentation includes personnel activity reports, electronic or manual time sheets, pay records integrated with grant codes, certification statements, budget-to-actual reconciliations, and activity descriptions and reports. Condition For AL No. 93.959, Block Grants for Prevention and Treatment of Substance Abuse, a sample of twenty-one (21) payroll transactions were tested for Activities Allowed or Unallowed and Allowable Costs/Cost Principles. During the testing of payroll transactions, we noted that while HSI does maintain nearly all of the required documentation such as personnel activity reports, pay records integrated with grant codes, activity descriptions and reports; it does not maintain electronic or manual time sheets or time records which precludes it from performing budget-toactual reconciliations of time records to adjust its allocations of salaries and wages expense charged to grants from those based on budgeted expenses to those based on actual expenses. Repeat Finding: Yes, see finding 2024-003 in the summary schedule of prior audit findings. Cause HSI has not yet implemented a process for maintaining timesheets or time records and performing budget-to-actual reconciliations of salaries and wages for the purpose of adjusting its allocations from those based on budgeted salaries and wages expense to actual salaries and wage expense. Effect The effect is that internal controls over compliance with time and effort documentation requirements were weakened which could result in disallowed costs if supporting documentation cannot be provided. Questioned Costs We were not able to determine questioned costs since time and effort reports were not available for us to compare salaries and wages expense allocated to grants based on budgeted amounts to salaries and wages expense allocated to grants based on actual amounts.