Finding 381192 (2023-005)

U.S. Department of Health and Human Services Federal Financial Assistance Listing Number 93.829 Section 223 Demonstration Programs to Improve Community Mental Health Services ‐ 6H79SM083306‐01M002 Activities Allowed or Unallowed, Allowable Costs/Cost Principles, and Period of Performance Significant Deficiency in Internal Control over Compliance Criteria: The OMB Compliance Supplement requires that non‐federal entities receiving federal awards establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Condition: During our testing, there was no documentation of review and approval of employee timecards for a portion of the sample selected. Cause: The Organization did not have an adequate internal control policy to ensure review and approval of employee timecards was documented. Effect: The lack of adequate policies governing employee timecards increases the risk that employees participating in the federal award administration may not be able to detect and correct noncompliance in a timely manner. Questioned Costs: None. Context/Sampling: A nonstatistical sample of 65 expenditures submitted for reimbursement were selected for testing. Of these 65, 1 did not show evidence of proper review and approval prior to payment. Repeat Finding from Prior Year(s): Yes. Recommendation: We recommend that the Organization enhance internal control policies to ensure all employee timecards are reviewed and approved prior to payment to ensure that all payments are necessary and correct. Views of Responsible Individuals: Management agrees with the finding.