Finding 32195 (2022-003)

Significant Deficiency Repeat Finding
Requirement
B
Questioned Costs
-
Year
2022
Accepted
2023-06-29
Audit: 30795
Organization: Northern Marianas College (MP)
Auditor: Bcm LLC

AI Summary

  • Core Issue: NMC failed to sign contract forms before the renewal of employment for 3% of sampled cases, violating federal regulations.
  • Impacted Requirements: Documentation of salaries and wages must reflect actual work performed and be supported by timely signed contracts.
  • Recommended Follow-Up: NMC should improve internal controls and ensure HR processes allow sufficient time for contract approvals before employment renewals.

Finding Text

Criteria: The Code of Federal Regulations (CFR) Subpart E ? Cost Principles, ?200.430(i), allowable costs must be adequately documented. ?200.430(i)(1) states ?Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated?? Further, according to 29CFR ?516.5(b) records such as employment contracts or agreements must be retained by employers for at least three years from their last effective date. Condition: For 3 of 115 items tested, or 3% of the sample, we noted that the contract form was signed after the effective date of the renewal of employment. Cause: NMC staff who are responsible for monitoring contract form renewals did not review these personnel files in a timely manner. Effect: NMC did not comply with federal regulations requirements in which contract forms should be signed prior to renewal of employment. With this situation, the employee is working without properly documented approval from authorized personnel. Recommendation: NMC should ensure that human resources personnel adhere to the internal control policies and procedures relevant to renewal of employment. Ample time to process employment documents should be available to ensure that the required approvals are obtained prior to renewal of employment. Views of Responsible Officials See corrective action plan immediately following this schedule of findings and questioned costs.

Corrective Action Plan

Finding No. 2022 ? 001, Payroll (Renewal of Personnel Action) Auditee Response: Contact Person: David Attao, CFO Contact Information: david.attao@marianas.edu Completion Date: December 2023 The College partially agrees with this finding as the situation is unique to disputes that arise between the employee and supervisor during the employee personnel action renewal process. Personnel Actions are implied as renewed per employee contract terms. In order to resolve this finding, the College will update and revise NMC Procedure No. 5101.7: Employee Evaluations and NMC Procedure No. 5006.1: Employee Grievances to provide the supervisor and employee a 90 day grace period to conduct the evaluation, to add and engage a grievance process as needed, and to provide time for any dispute resolutions or negotiations. After such actions take place, a final decision must be reached at least 30 days prior to the contract's expiration date in the event of a non-renewal or renewal of personnel actions. Finding No. 2022 ? 002, Payroll (Contract Renewals) Auditee Response: Contact Person: David Attao, CFO Contact Information: david.attao@marianas.edu Completion Date: December 2023 The College partially agrees with this finding as the three contracts were implied as renewed per employee contract terms. To resolve this finding, the College will update and revise NMC Procedure No. 5101.7: Employee Evaluations and NMC Procedure No. 5006.1: Employee Grievances to provide the supervisor and employee a 90 day grace period to conduct the evaluation, to add and engage a grievance process as needed, and to provide time for any dispute resolutions or negotiations. After such actions take place, a final decision must be reached at least 30 days prior to the contract's expiration date in the event of a non-renewal or renewal of contracts. Finding No. 2022 ? 003, Payroll Auditee Response: Contact Person: David Attao, CFO Contact Information: david.attao@marianas.edu Completion Date: December 2023 The College partially agrees with this finding as it is related to Finding No. 2022-002. The three contracts were implied as renewed per employee contract terms. To resolve this finding, the College will update and revise NMC Procedure No. 5101.7: Employee Evaluations and NMC Procedure No. 5006.1: Employee Grievances to provide the supervisor and employee a 90 day grace period to conduct the evaluation, to add and engage a grievance process as needed, and to provide time for any dispute resolutions or negotiations. After such actions take place, a final decision must be reached at least 30 days prior to the contract's expiration date in the event of a non-renewal or renewal of contracts.

Categories

Allowable Costs / Cost Principles Subrecipient Monitoring

Other Findings in this Audit

  • 608637 2022-003
    Significant Deficiency Repeat

Programs in Audit

ALN Program Name Expenditures
93.498 Provider Relief Fund $5.27M
84.063 Federal Pell Grant Program $5.14M
10.500 Cooperative Extension Service $1.37M
10.203 Payments to Agricultural Experiment Stations Under the Hatch Act $1.23M
97.U97 Usdhs-Commonwealth Worker Fund $800,000
84.938 Disaster Recovery Assistance for Education $745,796
84.031 Higher Education_institutional Aid $329,167
84.002 Adult Education - Basic Grants to States $282,695
93.107 Area Health Education Centers Point of Service Maintenance and Enhancement Awards $127,976
15.875 Economic, Social, and Political Development of the Territories $113,022
93.632 University Centers for Excellence in Developmental Disabilities Education, Research, and Service $104,600
10.767 Intermediary Relending Program $80,985
84.007 Federal Supplemental Educational Opportunity Grants $78,800
59.037 Small Business Development Centers $72,670
17.285 Apprenticeship USA Grants $72,445
84.379 Teacher Education Assistance for College and Higher Education Grants (teach Grants) $64,598
10.310 Agriculture and Food Research Initiative (afri) $55,870
84.033 Federal Work-Study Program $52,800
10.200 Grants for Agricultural Research, Special Research Grants $51,525
93.310 Trans-Nih Research Support $48,035
10.303 National Science Foundation, Islands of Opportunity Alliance $28,018
10.215 Sustainable Agriculture Research and Education $14,781
84.206 Javits Gifted and Talented Students Education $14,336
47.076 Education and Human Resources $9,230
84.408 Postsecondary Education Scholarships for Veteran's Dependents $6,124
84.425 Education Stabilization Fund $3,700