Finding Text
2022-001 Improve Time and Effort Documentation (Material Weakness)
Federal Agency: Department of Education
Cluster/Program: Special Education Cluster and Education Stabilization Fund
AL Number(s): 84.027/84.173, 84.425
Award Year: 2021 and 2022
Compliance Requirement: Allowable Costs/Cost Principles
Type of Finding
Compliance and Internal Control over Compliance - Material Weakness
Criteria or Specific Requirement
Federal grant recipients are required to maintain federally compliant documentation to support time and effort of employees working solely or partially on federal grants. These records must be maintained in accordance with federal cost principles (Uniform Guidance, 2 CFR Part 200.430), and must, in some documented fashion, provide evidence that the time charged to federal programs represents the time actually spent on that grant function by the employee. For employees who work partially on grant activities, time logs should be prepared and must be signed by either the employee or a supervisor knowledgeable of the work performed by the employee. For employees who work solely on grant activities, semi-annual certifications can be prepared and also must be signed by either the employee or a supervisor knowledgeable of the work performed by the employee.
Management of the School Department is also responsible for establishing and maintaining effective internal control over compliance with federal requirements that have a direct and material effect on a federal program. A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis.
Condition and Context
The School Department did not have adequate documentation to support the time and effort of employees who charged time to grant activities. The documentation did not clearly state the distribution of the employee’s time spent on grant activities.
Cause
The School Department does not have adequate controls in place over time and effort procedures.
Effect or Potential Effect
Due to the weaknesses in internal control noted above, there is a risk that amounts charged to federal awards may not be allowable or in accordance with applicable cost principles. Known and likely questioned costs reported are all payroll and related costs charged, as follows:
Questioned Costs
Known questioned costs are reported equal to $1,241,221, as follows:
AL Questioned
Number(s) Name of Federal Program or Cluster Costs
84.027/84.173 Special Education Cluster $596,331
84.425 Education Stabilization Fund $644,890
Identification as Repeat Finding
As identified in Section IV, the Schedule of Prior Year Findings, this is a repeat of finding 2021-002.
Recommendation
The School Department should address the weaknesses in internal controls noted above in order to provide reasonable assurance that federal awards are expended only for allowable activities, and that the costs of goods and services charged to federal awards are allowable and in accordance with the applicable cost principles.
Documentation should be retained to support time and effort of all employees who charge time to grant activities in accordance with applicable federal guidelines.
Views of Responsible Official
Management’s views and corrective action plan is included in a separate corrective action plan.