Finding Text
#2024-004 – Major Federal Award Finding – Period of Performance
Nature of Finding: Compliance Finding Period of Performance and Material Weakness in Internal Controls over Compliance
This is a repeat of prior year finding #2023-010.
Criteria/Condition: A non-federal entity may charge only allowable costs incurred during the approved budget period of a federal award’s period of performance. The Organization did not have controls in place to verify that costs were being charged to the award in the correct period of performance.
Questioned Costs: $8,324
Identification of How Questioned Costs Were Computed: A sample of 40 non-payroll expenditures totaling approximately $35,000 was selected from a population of approximately $577,000 of non-payroll expenditures. An amount of $503 from one invoice that was charged to the Crime Victim Assistance program was related to the year ending September 30, 2025 and was inappropriately charged to the grant during 2024. Questioned costs are estimated by projecting the error identified in the sample tested to the population of non-payroll expenditures of the Crime Victim Assistance program.
Cause/Context: Controls were put in place during the year ending September 30, 2024 to review invoices and assign them to the appropriate grant period; however, these controls were not operating as designed. Two expenditures out of forty non-payroll related expenditures tested for the Crime Victim Assistance grant were for a contracted annual service that covered multiple performance periods but was billed in its entirety to the current fiscal year. One of these contracted annual services had the correct annual cost allocated to the grant during the year ended September 30, 2024 and did not have questioned costs included above. The other contracted annual service invoice was included in the questioned costs above. One other expenditure out of forty non-payroll related expenditures tested was for services provided in the prior performance period and was initially billed to the grant during 2024. Prior to September 30, 2024, this expenditure was removed from a subsequent grant bill after the auditor discovered the error during interim procedures. This expenditure was not included above in questioned costs as it was removed from grant expenditures during 2024.
Effect: An overstatement of expenditures for the Crime Victim Assistance grant was reported in the current year.
Recommendation: We recommend procedures are consistently performed to review for proper grant period when recording transactions and creating monthly reimbursement requests.
Views of Responsible Officials and Planned Corrective Actions:
The YWCA will implement the following changes in its accounting procedures.
1. The Staff Accountant will review the period each expenditure is related to and record the invoice to the appropriate period when entering it into accounts payable. The month and year will be noted on the invoice.
2. The CFO will review the month and year noted by the Staff Accountant prior to entry into accounts payable.