Finding 563793 (2021-001)

Material Weakness
Requirement
A
Questioned Costs
-
Year
2021
Accepted
2025-06-04

AI Summary

  • Core Issue: The same person processes payroll and can change pay rates, violating internal control standards.
  • Impacted Requirements: There should be a clear separation between payroll processing and the ability to authorize pay changes.
  • Recommended Follow-Up: Implement a payroll change status report reviewed and signed by another individual each pay period.

Finding Text

2021-001 – Payroll – Segregation of Duties Condition: Our audit procedures disclosed that the person responsible for processing payroll has the capability of inputting pay rate changes into the payroll software. Additionally, this same individual has the ability to create employees within the payroll module. Criteria: Proper internal control requires there be a segregation of duties between the recordkeeping function (payroll processing) and the authorization function (access to change salary rates and edit payroll master files). Effect: These practices could allow for misappropriation of assets to occur without being detected. Cause: SAIL did not have procedures in place to address the risks from a lack of segregation. Recommendation: Due to the limited personnel in the accounting department, we recommend that the individual responsible for processing payroll continue to function with the same responsibilities; however, we recommend a payroll change status report be reviewed each pay period by another individual. This payroll change status form should be signed-off once reviewed. Response: SAIL agrees with the finding and will implement procedures to address the recommendation in 2023.

Corrective Action Plan

CORRECTIVE ACTION PLAN May 6, 2025 Glens Falls Independent Living Center, Inc. operating as Southern Adirondack Independent Living Center (EIN No. 14-1706914) respectively submits the following corrective action plan for the year ended September 30, 2021: Independent public accounting firm: Bryans & Gramuglia CPAs, LLC, One Pine West Plaza, Suite 107, Albany, New York 12205. Audit Period: October 1, 2020 – September 30, 2021 The finding from the September 30, 2021 schedule of findings and questioned costs is discussed below. The finding is numbered consistently with the numbers assigned in the schedule. FINDINGS - FINANCIAL STATEMENT AUDIT MATERIAL WEAKNESS 2021-001 – Payroll – Segregation of Duties Finding: Our audit procedures disclosed that the person responsible for processing payroll has the capability of inputting pay rate changes into the payroll software. Additionally, this same individual has the ability to create employees within the payroll module. Recommendation: Due to the limited personnel in the accounting department, we recommend that the individual responsible for processing payroll continue to function with the same responsibilities; however, we recommend a payroll change status report be reviewed each pay period by another individual. This payroll change status form should be signed-off once reviewed. Action Taken: Glens Falls Independent Living Center has hired an Administrative Coordinator who has been trained on our payroll software to input data including HR related documents, pay rates and benefit time once all has been approved by the Executive Director and Controller. Once data has been entered, it information is audited and initialed by Controller. Upon processing of the bimonthly payrolls by the Controller, pay rates and hours are checked by the Executive Director, Budget Director and the Program Director. FINDINGS - MAJOR FEDERAL AWARDS PROGRAMS AUDIT U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES PA SSED THROUGH THE NEW YORK STATE DEPARTMENT OF HEALTH, NEW YORK STATE DEPARTMENT OF HEALTH NEW YORK HEALTH BENEFIT EXCHANGE AND THE COMMUNITY SERVICE SOCIETY OF NEW YORK Medical Assistance Program - CFDA No. 93.778 Material Weakness: See Finding 2021-001 Sincerely yours, Tyler Whitney Executive Director

Categories

Internal Control / Segregation of Duties

Other Findings in this Audit

  • 563794 2021-001
    Material Weakness
  • 563795 2021-001
    Material Weakness
  • 1140235 2021-001
    Material Weakness
  • 1140236 2021-001
    Material Weakness
  • 1140237 2021-001
    Material Weakness

Programs in Audit

ALN Program Name Expenditures
93.778 Medical Assistance Program - Waiver Programs $447,358
93.432 Acl Centers for Independent Living $189,077
93.464 State Grants for Assistive Technology $178,512
93.432 Covid-19 - Acl Centers for Independent Living $66,412
93.778 Medical Assistance Program $28,949
93.767 Children's Health Insurance Program $2,642