Finding Text
Finding #2022-001 ? Significant Deficiency Applicable federal program: U. S. Department of Justice Assistance Listing #16.575 Passed through Office of the Governor, Criminal Justice Division Crime Victim Assistance Contract #?s: 3521203; 4219601; 4219602 Contract years: 10/01/21 ? 09/30/22; 10/01/21 ? 09/30/22; 10/01/22 ? 09/30/23 Criteria: Allowable Costs ? The Uniform Guidance ?200.430 and the Texas Grant Management Standards require that charges to awards for salaries and wages must be based on records that accurately reflect the work performed. These records must 1) be supported by a system of internal control which provides reasonable assurance the charges are accurate, allowable and properly allocated; 2) reasonably reflect the total activity for which the employee is compensated; 3) comply with the established accounting policies and practices of the agency; and 4) support the distribution of the employee?s salary or wages among specific activities or cost objectives if the employee works on more than one activity. Additionally, the Uniform Guidance requires costs to be necessary and reasonable for the performance of the federal award. Condition and context: During our testing of 25 payroll transactions, we noted the following: ? 9 transactions in March 2022 where allocations were not properly calculated resulting in a grant being undercharged. ? 1 transaction in March 2022 where an employee?s $280 bonus was charged to the grant, which is unallowable. Repeat of finding #2021-001. Cause: The errors in the payroll allocations and charging the bonus to a grant occurred due to failure to follow established policies and procedures. Effect: Failure to follow established internal control policies and procedures which requires reviews of payroll, including adherence to allocations methodology, resulted in errors in grant billings and could result in unallowable costs being charged to the grants, or vice versa. Recommendation: Emphasize adherence to established policies and procedures to ensure payroll, including allocations methodology, are properly followed and reviewed. Views of responsible officials and planned corrective actions: Management agrees with the finding. See Corrective Action Plan.