Finding 35992 (2022-001)

Significant Deficiency
Requirement
B
Questioned Costs
-
Year
2022
Accepted
2023-02-08
Audit: 30504
Auditor: Yeo & Yeo CPAS

AI Summary

  • Core Issue: The Center failed to support pay rates for 9 out of 40 payroll transactions tested under the Shuttered Venue Operators Grant.
  • Impacted Requirements: Federal procurement policy mandates that salary and hourly rates must be backed by proper contracts.
  • Recommended Follow-Up: Management should keep approved pay rate forms in each employee file and document any changes, ensuring proper payment compliance.

Finding Text

Program Information: AL #59.075 Shuttered Venue Operators Grant, U.S. Small Business Administration. Criteria: The federal procurement policy requires salary and hourly rates be properly supported by contracts. Condition: We noted that for 14 out of 40 payroll transactions tested for the Shuttered Venue Operators Grant the Center could not properly support pay rates. This included a total of 9 employees that did not have proper pay rate support. Questioned Costs: Not required to be reported. Cause and Effect: The Center is not retaining approve pay rate forms in all employee files. Management was not able to support the pay rates for 9 employees.Recommendation: We recommend that management retain approved pay rate forms in each employee file. Changes made to rates should also be documented in employee files and approved by the appropriate level of management. This will ensure that employees are being paid properly. View of Responsible Officials: Management agrees with the finding. Corrective Action Plan: See attached corrective action plan.

Corrective Action Plan

Corrective Action Plan Information: Finding Number: 2022-001. Finding: Significant Deficiency - Insufficient Pay Rate Support. Significant Deficiency and Noncompliance - Allowable Costs. Corrective Action Taken or To Be Taken: All pay rate changes; including but not limited to changes to position, increases or new hires are to be processed on an approved hard copy Pay Rate Change form that is signed and completed by HR, Approving Supervisor/Manager/Director, and employee. Form is then retained in each individual employee folder by Human Resources in physical and electronic form. Anticipated Completion Date: 02/01/2023. Agency Contact Responsible for Corrective: Action: Midland Center for the Arts, Name: Jo Ann Euashka, Title: Finance Manager, Address: 1801 W. St Andrews Rd., City, State, Zip Code: Midland, MI 48640, Email: euashka@midlandcenter.org, and Phone Number: 989-631-5930 ext. 1604.

Categories

Procurement, Suspension & Debarment

Other Findings in this Audit

  • 612434 2022-001
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
59.075 Shuttered Venue Operators Grant Program $1.55M
97.036 Disaster Grants - Public Assistance (presidentially Declared Disasters) $388,646