Finding Text
Item:
2022-003
Assistance Listing Number:
93.940
Programs:
HIV Prevention Activities
Federal Agency:
U.S. Department of Health and Human Services
Pass-Through Agencies:
Arizona Department of Health Services
Pass-Through Grantor Identifying Number:
252026/152034/152035
Award Year:
January 1, 2022 to December 31, 2022; April 1, 2021 to July 15, 2022; August 1, 2022 to July 31, 2023
Compliance Requirement:
Allowable Activities and Costs
Criteria:
In accordance with 2 CFR § 200.430 – Compensation – charges to federal programs for salaries and wages should be supported by a system of internal controls which provides reasonable assurance the amounts charged are accurate, allowable and properly allocated.
Condition:
The entity’s system of internal controls did not retain contemporaneous documentation of supervisory review over payroll allocations charged to the federal programs.
Questioned Costs:
n/a
Context:
In a population of over 250 payroll costs charged to the program, we conducted a non-statistical sample of 40 payroll costs charged to the program. In our sample of 40, we noted that 23 selections were charged to the program based on an allocation process. Payroll records and the nature of the Organization's programs evidenced that allowable cost and activities occurred. Recordkeeping regarding the supervisory review of the allocations was inadequate. As such, this is deemed to be a material weakness in internal control over compliance.
Effect:
The system of internal controls was not properly implemented.
Cause:
Turnover within key positions of the organization resulted in insufficient documentation and/or inadequate implementation of the control procedures.
Identification as a Repeat Finding:
Repeat finding
Recommendation:
The Organization should enhance it processes and controls to ensure that supervisory review of the payroll allocations is evidenced within the Organization’s books and records.
Views of Responsible Officials:
Management of the Organization concurs with the finding. See Corrective Action Plan.