Finding - Activities Allowed or Unallowed & Allowable Costs/Cost Principles: Payroll, Assistance Listing Number 93.243; June 30, 2024, award year; U.S. Department of Health and Human Services
Criteria or Specific Requirement
In accordance with 2 CFR 200.405, A cost is allocable to a Federal award if the cost is assignable to that Federal award with the relative benefits received. These costs must be incurred specifically for the Federal award.
Condition Found
Of the Seventeen payroll charges selected for testing, the allocation of payroll charged to the Federal grant did not align with the percentage of time incurred specifically for the Federal grant in four instances.
Views of Responsible Officials and Planned Corrective Actions
It was determined that the allocation percentage assigned in our payroll system did not match the calculated payroll expensed to the grant.
Corrective measures: 1) contacted our payroll administrator and determined the cause to be that an allocation percentage was applied to the employee and the employee was also assigning their time via their time sheet effectively calculating twice, first on the total payroll and again on the allocated amount. The employee was instructed not to enter the allocation since it is already done in the payroll system. 2) A monthly review and calculation will be performed by program management and accounting to verify cost allocations are correct.
Responsible Official: Korin Ihloff, CFO
Expected Completion Date: The issue was addressed immediately.