Finding 565703 (2022-001)

Significant Deficiency Repeat Finding
Requirement
B
Questioned Costs
$1
Year
2022
Accepted
2025-06-22
Audit: 359422

AI Summary

  • Core Issue: Lack of supporting documentation for expenditures leads to noncompliance with federal cost principles, resulting in questioned costs of $27,380.
  • Impacted Requirements: Federal program expenditures must be necessary, reasonable, and directly related to program objectives; inadequate documentation undermines these criteria.
  • Recommended Follow-Up: Improve documentation practices and enhance monitoring controls to ensure all expenditures are valid and allowable.

Finding Text

Finding No.: 2022-001 Federal Agency: U.S. Department of the Interior AL Program: 15.875 Economic, Social, and Political Development of the Territories Federal Award No.: Compact Sector Grants Questioned Costs: $27,380 Area: Allowable Costs/Cost Principles Criteria: Federal program expenditures should be necessary and reasonable for the performance of the Federal award, in accordance with allowable costs/cost principles requirements, and be directly related to, and in accordance with, program intent and objectives. Condition 1: For 3 (or 10%) of 29 non-payroll transactions tested aggregating $3,375,773 of $14,205,851 in total non-payroll program expenditures, supporting documentation were not provided for the following: Item # Fund # Encumbrance/ Voucher/JV # Account Total 1 410150 T83102001 Training and Staff Development $ 1,750 2 410100 G22-279W Food Stuff 18,275 3 410102 G22-283C Other Supplies and Materials 5,621 $ 25,646 Condition 2: For 8 (or 21%) of 39 payroll transactions tested aggregating $66,558 of $17,286,417 in total payroll program expenditures, the following deficiencies were noted: Leave hours were not supported by an approved leave form for the following: # Employee # PPE Hours Amount 1 93573 03/12/2022 16 114 2 88856 04/23/2022 8 92 $ 206 Condition 2, continued: Overpayment of or unsupported salaries and wages were noted for the following: # Employee # PPE Amount 1 94419 10/09/2021 $ 170 2 203158 10/23/2021 692 3 62883 11/20/2021 34 4 93669 12/18/2021 185 5 244918 8/13/2022 293 6 205561 9/10/2022 154 $ 1,528 Item # 1 resulted from 126 unsupported additional night differential hours paid. Item # 2 resulted from incorrect payment of 80 differential hours (paid at 20%) as regular hours. Item #s 3 and 4 each resulted from overpayment of 8 hours. Item # 5 resulted from incorrect retroactive pay calculation resulting in overpayment of 102.8 hours. Item # 6 resulted from incorrect standby differential rate used (30%) rather than the Public Service Commission Personnel Manual rate (20%). The above resulted in reportable questioned costs of $1,734 because the projected questioned cost amount exceeds the $25,000 threshold. Cause: Inadequate file maintenance to support expenditures charged to federal programs. RepMar did not effectively monitor the validity and allowability of expenditures. Effect: RepMar is in noncompliance with allowable costs/cost principles requirements. The reportable questioned cost is $27,380. Recommendation: Documents supporting expenditures should be maintained. Further, RepMar management should strengthen monitoring controls so that expenditures are verified for validity and allowability. Views of Responsible Officials: We partially agree with the finding and provide details in our Corrective Action Plan.

Corrective Action Plan

Condition 1: #1 All supporting documents for travel mission vouchers are now uploaded onto Bisan. #2 & #3: The MOF Secretary reiterated to Accounting management the need to ensure that manual JVs have complete supporting documents. Bisan has an online approval workflow for manual JVs which facilitates the review of manual entries, including supporting attachments, prior to posting to the general ledger. Condition 2: #1 & #2: Effective FY2025 PPE 14, MoF will no longer charge leave slips without proper supporting documents. . Condition 2, continued: #1 Employee did not receive a night differential for PP21 & PP22. #2 & #5: The online approval workflow in the payroll module of Bisan, where the ministry enters hours claimed while the MOF Payroll Division reviews and approves against supporting timesheets, helps ensure that payroll calculations are accurate. #3 and #4 Employee did not receive 8 regular hours in previous pay period (PP01) #6: 30% is a combination of 20% standby differential and 10% Ebeye differential.

Categories

Questioned Costs Allowable Costs / Cost Principles Subrecipient Monitoring

Other Findings in this Audit

  • 565704 2022-004
    Material Weakness Repeat
  • 565705 2022-005
    Significant Deficiency Repeat
  • 565706 2022-006
    Material Weakness Repeat
  • 565707 2022-009
    Material Weakness Repeat
  • 565708 2022-010
    Significant Deficiency Repeat
  • 565709 2022-002
    Material Weakness
  • 565710 2022-005
    Material Weakness
  • 565711 2022-007
    Material Weakness
  • 565712 2022-009
    Material Weakness
  • 565713 2022-011
    Material Weakness
  • 565714 2022-003
    Material Weakness Repeat
  • 565715 2022-005
    Material Weakness
  • 565716 2022-008
    Material Weakness Repeat
  • 565717 2022-009
    Material Weakness Repeat
  • 565718 2022-003
    Material Weakness Repeat
  • 565719 2022-005
    Material Weakness
  • 565720 2022-008
    Material Weakness Repeat
  • 565721 2022-009
    Material Weakness Repeat
  • 1142145 2022-001
    Significant Deficiency Repeat
  • 1142146 2022-004
    Material Weakness Repeat
  • 1142147 2022-005
    Significant Deficiency Repeat
  • 1142148 2022-006
    Material Weakness Repeat
  • 1142149 2022-009
    Material Weakness Repeat
  • 1142150 2022-010
    Significant Deficiency Repeat
  • 1142151 2022-002
    Material Weakness
  • 1142152 2022-005
    Material Weakness
  • 1142153 2022-007
    Material Weakness
  • 1142154 2022-009
    Material Weakness
  • 1142155 2022-011
    Material Weakness
  • 1142156 2022-003
    Material Weakness Repeat
  • 1142157 2022-005
    Material Weakness
  • 1142158 2022-008
    Material Weakness Repeat
  • 1142159 2022-009
    Material Weakness Repeat
  • 1142160 2022-003
    Material Weakness Repeat
  • 1142161 2022-005
    Material Weakness
  • 1142162 2022-008
    Material Weakness Repeat
  • 1142163 2022-009
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
93.323 Epidemiology and Laboratory Capacity for Infectious Diseases (elc) $2.57M
84.027 Special Education Grants to States $1.91M
93.268 Immunization Cooperative Agreements $1.07M
17.225 Unemployment Insurance $821,936
93.116 Project Grants and Cooperative Agreements for Tuberculosis Control Programs $753,281
93.898 Cancer Prevention and Control Programs for State, Territorial and Tribal Organizations $643,583
10.582 Fresh Fruit and Vegetable Program $584,706
11.460 Special Oceanic and Atmospheric Projects $439,312
15.904 Historic Preservation Fund Grants-in-Aid $423,284
93.069 Public Health Emergency Preparedness $407,951
15.875 Economic, Social, and Political Development of the Territories $290,106
93.945 Assistance Programs for Chronic Disease Prevention and Control $251,776
93.074 Hospital Preparedness Program (hpp) and Public Health Emergency Preparedness (phep) Aligned Cooperative Agreements $241,580
93.994 Maternal and Child Health Services Block Grant to the States $225,394
93.354 Public Health Emergency Response: Cooperative Agreement for Emergency Response: Public Health Crisis Response $209,308
84.325P The Republic of the Marshall Islands Teacher Retention Project $209,144
93.391 Activities to Support State, Tribal, Local and Territorial (stlt) Health Department Response to Public Health Or Healthcare Crises $199,155
93.224 Health Center Program (community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) $175,234
93.217 Family Planning Services $83,726
93.917 Hiv Care Formula Grants $78,330
45.310 Grants to States $51,863
10.664 Cooperative Forestry Assistance $43,035
93.110 Maternal and Child Health Federal Consolidated Programs $37,826
93.991 Preventive Health and Health Services Block Grant $36,139
97.042 Emergency Management Performance Grants $23,639
93.495 Community Health Workers for Public Health Response and Resilient $9,568
93.958 Block Grants for Community Mental Health Services $3,708
93.959 Block Grants for Prevention and Treatment of Substance Abuse $1,995