Finding 403889 (2022-003)

Significant Deficiency
Requirement
G
Questioned Costs
$1
Year
2022
Accepted
2024-06-28

AI Summary

  • Core Issue: Administrative fees exceeded the 10% limit on federal awards, resulting in questioned costs of $15,360.
  • Impacted Requirements: Compliance with 2 CFR 200.303 and 42 USC 300ff-28(b)(3)(B) regarding internal controls and administrative expense limits.
  • Recommended Follow-Up: Enhance internal controls for reviewing reimbursement requests to ensure compliance with grant budget limits.

Finding Text

Administrative Fees in Excess of 10% of Federal Award. Assistance Listing Number: 93.917 Program Title: HIV Care Formula Grants (Ryan White HIV/AIDS Program Part B) Pass-through Entity: Mississippi State Department of Health and United Way of Central Alabama Contract Number and Year: SG-1111-R3 2022 and RW-FHHS-2122 2022 Finding Type: Significant Deficiency Known Questioned Costs: $15,360 Criteria - 2 CFR 200.303 requires nonfederal entities receiving federal awards to establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of federal awards. The aggregate of expenditures for administrative expenses by subrecipients may not exceed 10% of the total amount of grant funds subawarded by the state (without regard to whether particular entities spend more than 10% for such purposes) (42 USC 300ff-28(b)(3)(B)). Condition - The Organization reviewed and signed off on reimbursement requests prior to submission for reimbursement. However, the reviewer did not catch requests for reimbursement of administrative fees in excess of 10% of subawards. Cause - The Organization reviewed and signed off reimbursement requests prior to submission for reimbursement. However, the reviewer did not catch requests for reimbursement in excess of 10% of subawards as formulas in Excel grant budget worksheets were overwritten with manual numbers, eliminating the calculation of check figures for total allowable administrative fees, administrative fees reimbursed to date and balance of allowable administrative fees for reimbursement. Effect - Administrative fees in excess of the 10% limit were submitted for reimbursement in error. Recommendation - The Organization should strengthen internal controls for oversight and approval to ensure the accuracy of allowable administrative fees per grant budgets. Views of Responsible Officials - The CFO has implemented procedures to review and monitor grant administrative expenditures and budgets.

Corrective Action Plan

Since completion of the fiscal year ended 9/30/2022, the Organization has added a Director of Grants Management, two grant billers and a purchasing manager to help ensure policies and procedures are being followed. In response to this finding, the CFO and Director of Grants Management have instituted multiple internal processes to confirm administrative fees do not exceed 10% of grant award. The grant biller will prepare a monthly reimbursement schedule in Excel which shows the budgeted amount for each category. The Director of Grants Management reviews and approves this schedule to ensure it meets the grant requirements. Each individual monthly reimbursement form is approved and signed by the Director of Grants Management to confirm accuracy. Then the reimbursement form submitted is entered in a master spreadsheet "Projects by Line Item" which shows original budget, monthly amounts billed for each budget line item, and remaining balance for each item. This is reviewed each month to ensure no amounts, including the administrative costs exceed approved amounts. Anticipated Completion Date: 9/30/2023 Responsible Contact Person: Chris White, CFO

Categories

Questioned Costs Subrecipient Monitoring Internal Control / Segregation of Duties Cash Management Significant Deficiency

Other Findings in this Audit

  • 403888 2022-002
    Significant Deficiency
  • 403890 2022-003
    Significant Deficiency
  • 980330 2022-002
    Significant Deficiency
  • 980331 2022-003
    Significant Deficiency
  • 980332 2022-003
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
93.686 Ending the Hiv Epidemic: A Plan for America — Ryan White Hiv/aids Program Parts A and B (b) $157,777
93.940 Hiv Prevention Activities_health Department Based $106,383
93.917 Hiv Care Formula Grants $84,509
14.241 Housing Opportunities for Persons with Aids $45,000
93.145 Aids Education and Training Centers $40,000
93.917 Covid 19 Hiv Care Formula Grants $18,849
93.941 Hiv Demonstration, Research, Public and Professional Education Projects $12,500
14.241 Covid 19 Housing Opportunities for Persons with Aids $5,930
93.307 Covid 19 Minority Health and Health Disparities Research $5,000