Finding 28618 (2022-002)

2022-002 ? SIGNIFICANT DEFICIENCY Payroll Allocations Condition: The Organization performs manual allocations of employee payroll to the appropriate major federal award programs. During our audit we identified adjustments that needed to be made in order to ensure the proper amount is billed to the corresponding Federal program, and the proper payroll cost allocations are reflected in the Schedule of Expenditures of Federal Awards.Criteria: Management is responsible for achieving appropriate financial reporting objectives, including maintaining complete accounting records in conformity with accounting principles generally accepted in the United States of America. Cause: The Organization has minimal staff to perform accounting procedures and the payroll procedures in place did not include a review of payroll allocations. Effect: Intentional and unintentional errors could be made and not detected within a timely period by Organization personnel in the normal course of performing their assigned functions resulting in the potential for improper billings and payments to staff. Recommendation: A remedy for this situation would be for the Organization to implement additional payroll procedures and review of payroll allocations. Response: Management will review its payroll procedures and payroll allocation procedures and implement improvements where practical.