Finding 504839 (2023-002)

45 CFR § 75.405(a) states a cost is allocable to a particular Federal award or other cost objective if the goods or services involved are chargeable or assignable to that Federal award or cost objective in accordance with relative benefits received. This standard is met if the cost: (1) Is incurred specifically for the Federal award; (2) Benefits both the Federal award and other work of the non-Federal entity and can be distributed in proportions that may be approximated using reasonable methods; and (3) Is necessary to the overall operation of the non-Federal entity and is assignable in part to the Federal award in accordance with the principles in this subpart. Ohio Admin. Code § 5101:9-7-20 outlines the requirements for child welfare random moment sample (CWRMS) time studies. Data collected from these time studies are used to calculate allocation statistics used to distribute cost pool expenditures to the appropriate programs. Ohio Admin. Code § 5101:9-7-20(E)(2)(b) states the employee is required to complete the comment section. Comments shall demonstrate that the selected program and activity codes support the work being performed by the assigned position at the time of the observation. Additionally, the Ohio Department of Job and Family Services’ Random Moment Sample (RMS) Manual states backup documentation for CWRMS observations should be maintained for audit purposes according to each agency’s internal document and record retention policies and procedures. Due to the lack of sufficient controls over observation completion and review, we noted six out of twenty-five (24%) CWRMS observations in which the Richland County Children Services agency was unable to provide appropriate documentation to support the observation data recorded by the caseworker. Lack of documentation to support the activities being completed at the observation moment could result in invalid observations and unallowable costs being charged to federal programs. The Richland County Children Services agency should develop and implement procedures to ensure that sufficient documentation is maintained to support activities noted on all CWRMS observation forms.