Finding Text
Item:
2022-004
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 detect, or document the rationale for, instances in which the amounts charged to a federal program did not agree to the underlying supporting documentation maintained by the Organization.
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 2 selections were charged to the program for amounts that did not agree to the underlying supporting documentation maintained by the Organization. The variances between the amounts charged and the amounts supported, as well as the projected impact to the entire population, were trivial in nature. However, the deviation rate in the control objective resulted in the conclusion that 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:
Not a repeat finding
Recommendation:
The Organization should enhance its processes and controls to ensure that differences between the amounts billed to federal awards and the underlying supporting documentation are thoroughly investigated. If the differences are justifiable, the justification should be documented and retained. If the differences are in error, the billing should be corrected prior to submission.
Views of Responsible Officials:
Management of the Organization concurs with the finding. See Corrective Action Plan.