FAC Explorer

Finding 2964 (2022-003)

Significant Deficiency
Requirement
B
Questioned Costs
$1
Year
2022
Accepted
2023-11-30
Audit: 4859
Organization: Thurston County Economic Development Council (WA)
Auditor: Cliftonlarsonallen LLP

AI Summary

  • Core Issue: There was a significant deficiency in internal controls, leading to an error in payroll expenditures for the Coronavirus State and Local Recovery Funds.
  • Impacted Requirements: Compliance with 2 CFR § 200.430(i)(1) was not met, as employee hours were incorrectly coded, resulting in questioned costs of $69.
  • Recommended Follow-Up: Implement enhanced payroll training and regular reconciliation processes to prevent future errors.

Finding Text

Federal Agency: Department of Treasury Federal Program Name: Coronavirus State and Local Recovery Funds Federal Award Identification Number and Year: 03-22-001-0001-0001 - 2022 Pass-Through Agency: Thurston County Pass-Through Number: None Award Period: March 1, 2021 to December 31, 2025 Type of Finding: Significant Deficiency in Internal Control and Compliance over Major Programs Criteria or Specific Requirement: Internal controls and other compliance knowledge should prevent the incorrect coding of employee hours worked. Per 2 CFR § 200.430(i)(1), "charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. Condition: Internal controls and adherence to compliance did not detect an error in payroll expenditures to the Coronavirus State and Local Recovery Funds program. Questioned costs: Total questioned cost of $69 based on 2.75 hours of sick time incorrectly charged to the Coronavirus State and Local Recovery Fund grant (ALN 21.027), contract number 03-22-001-0001-0001. Context: During our testing of payroll, 1 out of the 40 paychecks had hours charged to the Coronavirus State and Local Recovery Funds program. Cause: The error related to charging sick time to the grant rather than to administrative expenses. The error was not detected until the audit. Effect: Lack of review and reconciliation of time and effort could lead to inappropriate charges to Federal programs. Recommendation: CLA recommends increased payroll training and reconciliation. View of Responsible Official: There is no disagreement with the audit finding. Management’s response and corrective action plan is attached to our report.

Corrective Action Plan

Significant Deficiency in Internal Control over and Compliance over Programs Coronavirus State and Local Fiscal Recovery Funds - Assistance Listing No. 21.027 Recommendation : CLA recommends increased payroll training and reconciliation procedures. Action planned in response to finding : Classification of payroll hours assigned to Coronavirus State and Local Fiscal Recovery Funds, and all others, are to be reviewed and signed off on by accounting or administrative staff before submission of payroll. Names of the contact persons responsible for corrective action: Maria Hemmen, Brooke Johnson or Matt Stacey. Planned completion date for corrective action plan: October 27, 2023

Categories

Questioned Costs Internal Control / Segregation of Duties Significant Deficiency

Other Findings in this Audit

  • 2965 2022-004
    Significant Deficiency
  • 579406 2022-003
    Significant Deficiency
  • 579407 2022-004
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
12.002 Procurement Technical Assistance for Business Firms $903,152
11.307 Economic Adjustment Assistance $428,021
21.027 Coronavirus State and Local Fiscal Recovery Funds $66,065
17.278 Wia Dislocated Worker Formula Grants $24,600
59.043 Women's Business Ownership Assistance $18,000
10.175 Farmers Market and Local Food Promotion Program (b) $14,700
00.U12 U.s Navy $4,016