Finding Text
2022 ? 001 Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Section 8 Housing Assistance Payments Program Assistance Listing Number: 14.195 Contract Number: MA060470201 Award Period: October 1, 2021 through September 30, 2022 Type of Finding: ? Significant Deficiency in Internal Control Over Compliance ? Other Matters Criteria or specific requirement: Disbursements should be only for allowable expenses of the Project. Condition: A separated employee's earned time was paid out at the incorrect pay rate in error, resulting in an overpayment to the employee. Questioned costs: $18,048 Context: The error impacted one employee and appears to be an isolated incident. Cause: As part of the separated employee?s transition, the separated employee agreed to stay on and work on a per diem basis at a higher hourly rate. The employee?s hourly rate had been updated in the human resources information system prior to the earned time pay out. The earned time pay outs hours was then processed with the new hourly rate. As the total hours to be paid out was validated, the new rate was over looked, thus resulting in the separated employee being overpaid. This was caught by management subsequently after the pay-out as part of their monthly review and import into Yardi. Effect: An overpayment of $18,048 was made and is owed to the Organization by the employee as of the fiscal year end. Repeat Finding: No Recommendation: Management should review its internal control procedures to ensure proper oversight over the payroll disbursement process surrounding earned time payouts. View of responsible officials and planned corrective actions: In agreement with the finding. Upon realization of the overpayment, Human Resource (HR) and Payroll have developed a new process where the hourly rates are to be verified and validated for all employees that stay employed but are no longer eligible to accrue earned time, thus requiring their earned time to be paid out. On the bi-weekly HR changes worksheet, HR will denote what the hourly rate should be upon pay out of the earned time. Payroll will then cross-check the hourly rate and the earned time hours prior to processing payroll.