Finding Text
Finding 2023-002 Material Weakness – B. Allowable Costs
Federal Agency: U.S. Department of the Treasury
Passthrough Entity: Missouri Behavioral Health Council
Assistance Listing Number and Federal Program: 21.027 Coronavirus State and Local Fiscal Recovery Funds
Criteria:
Per CFR 200.405(a), a good or service must be chargeable or assignable to the Federal award or the cost objective
for that cost to be considered allocable to the Federal award. This standard is met if the cost is incurred specifically for the Federal award or benefits both the Federal award and other work of the non-Federal entity and can be proportioned using reasonable methods. In addition, the cost meets the standard listed above if the cost is necessary to the overall operation of the non-Federal entity and is assignable to the Federal award in accordance with the principles listed above. The approved cost objective stated in the grant agreement is for the construction of the Association’s new Kirksville location.
Statement of Condition:
During the course of our audit, it was discovered that two invoices for engineering services provided by Yager
Architecture, Inc., were for remodeling one of the Hannibal locations and not for the construction of the Kirksville location. These invoices were included in the reimbursement request “KV-4” and the total for the two invoices was $4,902.50. Per the grant agreement, the grant funds were awarded for the construction of the Kirksville building construction.
Statement of Cause:
This is the first year the Association received grant funding from this specific grant, along with the growth the
Association is experiencing, and the Association being awarded two Federal grants in quick succession, the
accounting system and staff were not prepared to effectively adhere to the requirements of the grant. Therefore, unallowable costs were used for reimbursement requests.
Statement of Effect:
Noncompliance with the grant agreement could result in the Association being barred from receiving grant funding from the pass-through entity and/or the awarding agency for future grants, as well as the possibility that the awarding agency will require that some or all of the funding that has been received by the Association be refunded to the passthrough entity.
Questioned Costs:
No questioned costs were identified.
Identification of Repeat Findings:
N/A
Recommendations:
Reimbursement requests and included invoices should be reviewed and signed off on by someone other than the person completing the request. This will ensure that the correct invoices are included in the request that are allowed by the grant agreement and the invoices are in compliance with 2 CFR 200. In addition to this, the Association should create project codes or classes within their accounting system, if able to, for easier grant tracking. These recommendations would increase the accuracy of invoices used for reimbursement.
Views of Responsible Official(s):
The Association had converted to a different accounting system and did not have the expertise involving project codes or classes at this time. Going forward, the Association will use project codes or classes in the accounting system for grant tracking. See corrective action plan.