Finding Text
Federal Agency: U.S. Department of Housing and Urban Development
Federal Program Name: Community Development Block Grant
Assistance Listing Number: 14.218
Pass-through Agency: City of Allentown (CA); City of Bethlehem (CB); Northampton County (NC); Lehigh County (LC)
Pass-Through Number: N/A
Award Period: January 1, 2022 - December 31, 2024 (CA); January 1, 2022 - December 31, 2023 (CB); July 1, 2020 - December 31, 2022 (NC); January 1, 2020 - December 31, 2021 (LC); January 1, 2022 - September 15, 2023 (LC); January 1, 2021 - December 31, 2022 (NC); January 1, 2021 - September 15, 2022 (NC); April 1, 2023 - March 24, 2024 (NC)
Type of Finding:
• Material Weakness in Internal Control over Compliance
• Other Matters
Criteria:
3 CFR Part 200 Charges to Federal awards for salaries and wages must be based on records that
accurately reflect the work performed.
Condition:
During our testing, we noted that 21 out of 40 transactions tested exhibited a variance in the recalculation of wages charged to the program. This variance was identified when comparing the wages charged to the program with the time and effort documented on the timesheet for the respective programs.
Questioned Costs:
No questioned costs above the $25,000 threshold have been identified.
Context:
The Organization did not have proper controls in place to ensure the salary and wages charged to the program were based on the records of the work performed.
Cause:
The Organization experienced turnover within the finance department causing a lack of a review of the salary allocations to the program.
Effect:
When an organization does not have adequate controls designed to ensure personnel costs are documented with time and effort certifications, it can lead to a lack of transparency and accountability in recording and reporting personnel costs. This can result in inaccurate financial statements and potential non-compliance with regulatory requirements.
Repeat Finding:
N/A: Not a repeat finding
Recommendation:
We recommend the time and effort documentation be regularly reviewed by appropriate personnel to ensure accuracy and completeness of personnel cost documentation is appropriately reported to the federal program.
View of Responsible Officials and Planned Corrective Action:
Please refer to Community Action Committee of the Lehigh Valley, Inc. and subsidiaries’ Corrective Action Plan