Finding Text
U.S. Department of Health and Human Services, pass-through State of Tennessee Department of Health - Immunization Cooperative Agreements (ALN COVID-93.268) Federal Award Identification Number Year 34349-31823 2022 Criteria: Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to federal awards but may be used for interim accounting purposes, provided that: ? The system for establishing the estimates produces reasonable approximations of the activity actually performed; ? Significant changes in the corresponding work activity (as defined by the non-federal entity?s written policies) are identified and entered into the records in a timely manner. Short-term (such as one or two months) fluctuation between workload categories need not be considered as long as the distribution of salaries and wages is reasonable over the longer term; and ? The non-federal entity?s system of internal controls includes processes to review after-the-fact interim charges made to a federal award based on budget estimates. All necessary adjustment must be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated. Condition and Cause: During the period July 1, 2022, through December 31, 2022, the Foundation allocated salaries and benefits to the federal award based on the approved grant budget. Personnel working on the federal award are not required to keep timesheets, and internal controls have not been established for an after-the-fact review of charges to the Federal award based on budget estimates. Rent expenses to the federal award were allocated based on budgeted time spent on the program instead of actual. Effect or potential effect: Budget estimates alone do not qualify as support for charges to Federal award. Charges for actual time worked could vary, resulting in an incorrect amount charged to the federal award for salaries, benefits, and rent expenses. Additionally, since the Foundation is using budgets without an after-the-fact review of charges, the Foundation is not complying with the cost principles. Recommendation: We recommend that personnel who work on the federal award maintain a weekly timesheet that is reviewed and approved by the appropriate supervising personnel. We recommend that the Foundation perform an after-the-fact review of charges made to the federal award compared to the timesheets for the work performed and make any adjustments necessary. This after-the-fact review should be performed quarterly, at a minimum. Views of responsible officers: Management acknowledges this finding and will address remediation in the accompanying management?s corrective action plan in appendix A.