FAC Explorer

Finding 393717 (2023-001)

Significant Deficiency
Requirement
P
Questioned Costs
-
Year
2023
Accepted
2024-04-18
Audit: 303891
Organization: Serenity Foundation of Texas (TX)
Auditor: Condley and Company LLP

AI Summary

  • Core Issue: Many payroll transactions lack proper documentation for approved pay rates.
  • Impacted Requirements: Internal controls over compliance regarding pay rate approvals are not being followed.
  • Recommended Follow-Up: Establish a process to ensure pay rates are approved and documented in employee files.

Finding Text

Criteria: Pay rate approvel by supervisory personnel and documentation of that approval, was identified to be a key internal control over compliance. Condition: We reviewed a sample of 52 payroll expense transactions that were classified as program costs. Of the 52 transactions tested, 19 did not have appropriate documentation maintained for the approved pay rate. Effect: Inaccurate employee pay rates could result in an improper amount of payroll expense classified as program costs. Cause: Procedures were not in place to ensure that pay rate approval documentation was maintained in each employee file. Recommendation: We recommend the Foundation implement a process to ensure pay rates are approved by the supervisory personnel, and documentation of that approval is maintained in each employee file.

Corrective Action Plan

Beginning in September 2023, the previous process requiring the CEO's review and approval of total hours, pay rate, and total pay by employee and category is now being executed. In February 2024, a new payroll change form was implemented. The form documents any position or pay rate changes and requires approval from the Supervisor as well as the CFO. A concerted effort has also been made since September 2023 to better organize all personnel files to ensure that signed forms are filed into the correct personnel file.

Categories

Internal Control / Segregation of Duties

Other Findings in this Audit

  • 393718 2023-001
    Significant Deficiency
  • 393719 2023-001
    Significant Deficiency
  • 393720 2023-001
    Significant Deficiency
  • 393721 2023-001
    Significant Deficiency
  • 393722 2023-001
    Significant Deficiency
  • 393723 2023-001
    Significant Deficiency
  • 970159 2023-001
    Significant Deficiency
  • 970160 2023-001
    Significant Deficiency
  • 970161 2023-001
    Significant Deficiency
  • 970162 2023-001
    Significant Deficiency
  • 970163 2023-001
    Significant Deficiency
  • 970164 2023-001
    Significant Deficiency
  • 970165 2023-001
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
93.959 Substance Abuse Prevention Block Grant $250,841
93.959 Substance Abuse Recovery Support Block Grant $153,166