Finding Text
2022-002 Improve Time and Effort Documentation
Federal Program(s) Information
Federal Agency: U.S. Department of Agriculture
Cluster/Program: National School Lunch Cluster
AL Number(s): 10.553/10.555
Award Year: 2022
Compliance Requirement: Allowable Costs/Cost Principles
Type of Finding
Compliance
Internal Control over Compliance – Significant Deficiency
Criteria or Specific Requirement
Grantees must provide reasonable assurance that Federal awards are expended only for allowable activities and that the costs of goods and services charged to Federal awards are allowable and in accordance with the applicable cost principles. Management of the Town is also responsible for establishing and maintaining effective internal control over compliance with Federal requirements that have a direct and material effect on a Federal program. A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a Federal program on a timely basis.
Condition and Context
A sample of disbursements charged to the grants were tested for proper supporting documentation in order to determine if in accordance with Federal Allowable Costs/Cost Principles. As a result of testing of payroll disbursements charged to grants, certain costs were found that did not meet the time and effort documentation requirements.
Cause
Weakness in the design and operation of internal controls.
Effect or Potential Effect
Due to the weaknesses in internal controls noted above, there is a risk that amounts charged to Federal awards may not be allowable or in accordance with applicable cost principles. Known questioned costs are reported equal to $9,899.87, as follows:
AL Questioned
Number(s) Name of Federal Program or Cluster Costs
10.553/10.555 Child Nutrition Cluster $9,899.87
2022-002 Improve Time and Effort Documentation (Continued)
Recommendation
The Town should address the weaknesses in internal controls noted above in order to provide reasonable assurance that federal awards are expended only for allowable activities, and that the costs of goods and services charged to federal awards are allowable and in accordance with the applicable cost principles.
Views of Responsible Official
Management agrees with the finding.
Planned Corrective Action
Management’s corrective action plan is included at the end of this report after the Schedule of Prior Year Findings.