Finding Text
Time Keeping
Criteria
Management has identified an issue pertaining to timekeeping compliance. Specifically, certain activities related to preparing or working on proposals were classified as direct payroll costs charged to federal programs, rather than being treated as indirect costs.
Context
CRDF Global lacks proper controls to ensure that proposal activities are appropriately charged as indirect costs. According to 2 CFR 200.460, proposal costs encompass the expenses incurred in preparing bids, proposals, or applications for potential federal and non-federal awards or projects. This includes the development of data necessary to support the bids or proposals. Generally, proposal costs, whether successful or unsuccessful, should be treated as indirect costs and allocated to all activities of the non-federal entity.
Cause
Ineffective time charging guidance was provided to program staff.
Effect
As a result, there is an incorrect reporting of payroll costs between direct and indirect categories for federally funded projects.
Questioned Costs
None.
Repeat Finding
No.
Recommendation
To address this issue, we recommend that management enhances its current policies and procedures. Specifically, there should be a focus on ensuring that effective time charging guidance is provided to program staff. Additionally, payroll and other expense allocations should be corrected to avoid any further discrepancy.