Finding Text
Program Information:
U.S. Department of the Interior
AL Number Award Number Award Period Grant Name
15.029 A21AV00088 10/1/2020-9/30/2023 Judicial Services
U.S. Department of Transportation
AL Number Award Number Award Period Grant Name
20.205 A18AV01093/A17AV00612 1/1/2018-12/31/2022 Highway Planning and Construction Cluster
AL Number Award Number Award Period Grant Name
20.509 A18AV01093/218AV00785 1/1/2018-9/30/2023 Road Maintenance Programs
Criteria:
Per 2 CFR § 200.303 Internal controls, the non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).
The cost principles in 2 CFR part 200, subpart E (Cost Principles), prescribe the cost accounting requirements associated with the administration of federal awards by:
a. States, local governments, and Indian tribes.
b. Institutions of higher education (IHEs).
c. Nonprofit organizations.
Except where otherwise authorized by statute, cost must meet the following general criteria in order to be allowable under federal awards;
4. Be accorded consistent treatment. A cost may not be assigned to a federal award as a direct cost if any other cost incurred for the same purpose in like circumstances has been allocated to the federal award as an indirect cost.
7. Be adequately documented.
Condition/Context:
During transactional testing of the Judicial Services (AL #15.029) program, the following were noted:
• 12 of 26 nonpayroll samples did not have proper approvals.
• 3 of 34 payroll samples did not have proper Personnel Status Forms provided.
• 3 of 34 payroll samples did not have proper Timesheet approvals.
• 2 of 34 payroll samples did not have proper pay rate documented.
During transactional testing of the Highway Planning and Construction Cluster (AL #20.205), the following were noted:
• 8 of 8 Individually Important Items (IIIs) did not have all required approvals.
• 11 of 40 non payroll samples did not have all required approvals.
• 20 of 20 payroll samples did not have payrate approval provided.
• 2 of 20 payroll samples did not have an approved timesheet.
• 2 of 40 non payroll samples did not have adequate support provided.
During transactional testing of the Road Maintenance Programs (AL #20.509), the following were noted:
• 1 of 4 IIIs did not have support provided.
• 3 of 4 IIIs did not have proper approvals.
• 39 of 39 non payroll samples did not proper approvals.
• 4 of 21 payroll samples were missing timesheets.
• 2 of 21 payroll samples did not have an accurate Payroll Status Form provided.
[X] Compliance Finding [ ] Significant Deficiency [X] Material Weakness
Cause:
Due to turnover in key personnel and lack of internal controls, the entity did not have the ability to provide supporting documentation.
Effect:
Without an effective internal control system, an entity’s objective: operations, reporting, and compliance cannot be achieved. In addition, program funds could be expended on activities or costs that are deemed unallowable by the funding agency.
Questioned Costs:
Known – $32,912 AL # 15.029 – Judicial Services.
Known – $61,693 AL # 20.205 – Highway Planning and Construction Cluster.
Known – $13,275 AL # 20.509 – Road Maintenance Programs.
Repeat Finding:
Yes – 2021-003.
Recommendation:
We recommend that Joint Programs use the Green Book to design, implement, and operate internal controls to achieve its objectives related to operations, reporting, and compliance. We also recommend all records be maintained and filed in a way that allows them to be located and reviewed at any point in time.
View of Responsible Officials and Planned Corrective Action:
Management agrees with the finding and has prepared corrective action as detailed in its Corrective Action Plan.