Finding Text
Allowable Costs – Ryan White Part B HIV Care Formula Grants – Federal Assistance Listing Number 93.917; Award Period: Year ended June 30, 2023; Pass-through entity names: Virginia Department of Health and Northern Virginia Regional Commission.
Allowable Costs – Housing Opportunities For Persons With AIDS – Federal Assistance Listing Number 14.241; Award Period: Year ended June 30, 2023.
Criteria: Per 2 CFR §200.430(i), non-federal entities are required to maintain records that accurately reflect work performed. These records must be supported by a system of internal control which provides reasonable assurance that the time being charged is accurate, allowable and properly allocated, are incorporated in the official records, such as payroll records, reasonably reflect the employee’s total activity, provide a time or percentage breakdown on all activities, both federally and non-federally funded, for the employee, and comply with the non-federal entity’s pre-established accounting practices and procedures.
Condition: The Organization allowed payroll related costs to be submitted for reimbursement under the grant for time that did not match approved timesheets. This is not in compliance with program allowable cost requirements.
Cause: There is a lack of review of payroll registers to compare to timesheets to ensure the proper number of hours are submitted for reimbursement.
Effect: The Organization billed the incorrect amount of payroll and related costs to the federal program, resulting in questioned costs.
Questioned Costs: The amount of payroll and related costs discovered to be incorrect.
Context: Timesheets of numerous employees were found to not match the hours used in calculating payroll to be submitted for reimbursement to the grant.
Recommendation: We recommend the Organization implement a process to first record time into the payroll system based on timesheets, then further implement a review process to compare the payroll register hours to the approved timesheets.
Views of Responsible Officials: The Organization would like to note that the repeat finding is a result of the prior audit being completed near the end of the year ended June 30, 2023. The auditee agrees with this recommendation and has taken the necessary steps to prevent a re-occurrence. Lack of timesheets and pay rates resulted in the inability to show that time and payroll were accurately recorded. This resulted in additional procedures during the audit process being performed to obtain reasonable assurance over these balances.