Finding Text
Federal Program: Workforce Investment Opportunity Act Cluster
Assistance Listing 17.258 WIOA Adult Program
Assistance Listing 17.259 WIOA Youth Activities
Assistance Listing 17.278 WIOA Dislocated Worker Formula Grants
Pass-Through Entity Identifying Number: 05-P19-Youth-81/05-P20-Youth-81
05-F20-Adult-81/05-F21-Adult-81/05-F22-Adult-81
05-F20-DLW-81/05-F21-DLW-81/05-F22-DLW-81
Federal Agency: U.S. Department of Labor
2022-002 Criteria or specific requirement: Subrecipient Monitoring (2 CFR 200.331 and 20CFR 683.210)
and Activities Allowed or Unallowed (2 CFR 200, Subpart E) – Management is responsible
for ensuring compliance with certain provisions of laws, regulations, contracts, and grant
agreements.
Condition: An ongoing investigation by a state agency on the WIOA program for the 2021
program year (fiscal 2022) has alleged a potential violation of cost allowable under
federal awards. The reports state that there are questioned costs of approximately
$775,000.
Questioned Costs: $775,000
Context: The Organization operated without a legally binding agreement for WIOA Title I
and One-stop Operator Services for over 10 months after the expiration of the previous
contract. This results in questioned costs of $725,000. In addition, there was not
sufficient documentation to support the allocation basis for certain expenditures charged to
WIOA that resulted in additional questioned costs.
Effect: The noncompliance could have a direct and material effect on the financial
statements.
Cause: Proper allowable costs policies and procedures were not in place according to
the state agency.
Identification as a Repeat Finding, if Applicable: N/A
Recommendation: We recommend the Organization strengthen controls and processes
related to the allowable costs policies and procedures.
Views of Responsible Officials and Planned Corrective Actions: Management is considering its options for further appeals to the Department of Labor for review.