Finding Text
Criteria or Specific Requirement: In accordance with 2 CFR 200.403(a), costs charged to a federal
award must be allowable under the provisions of the cost principles, the terms and conditions of the award,
and the approved budget. Additionally, earmarking requirements in the grant agreement and associated
budget restrict specific categories of expenditures, including a cap on allowable software costs.
Condition: During our testing of expenditures claimed for reimbursement, we noted that Solvista Health
incurred and claimed software-related costs in excess of the grant agreement, which explicitly limits
allowable software expenditures.
Context: The software expenditures submitted exceeded the software costs allowed per the grant
agreement.
Questioned Costs: $2,814 consisting of exceeded software expenditures submitted for reimbursement.
Cause: Solvista Health did not have adequately designed and implemented internal controls related to
monitoring of compliance with earmarking requirements specific to software expenditures under the terms
of the grant.
Effect: Solvista Health exceeded the allowable software cost limit established by the grant.
Identification as a Repeat Finding: Not a repeat finding.
Recommendation: We recommend that Solvista Health design and implement grant monitoring internal
controls to ensure expenditures comply with all earmarking limitations specified in grant agreements and
approved budgets. In particular, Solvista Health should implement procedures to track expenditures by
budget category and verify compliance prior to submitting reimbursement requests.