Finding 574141 (2024-002)

Significant Deficiency
Requirement
B
Questioned Costs
-
Year
2024
Accepted
2025-08-21

AI Summary

  • Core Issue: Payroll hours for employees did not match between timesheets and allocation spreadsheets, leading to potential inaccuracies in salary charges.
  • Impacted Requirements: Internal controls over Federal awards must ensure accurate tracking of salaries and wages as per 2 CFR 200.303(a) and 2 CFR 200.430(i)(1).
  • Recommended Follow-Up: Strengthen internal control policies to ensure timely detection and correction of payroll errors, ensuring compliance with Federal requirements.

Finding Text

2024-002 Compensation for Personal Services Coronavirus State & Local Fiscal Recovery Funds – Assistance Listing No. 21.027 – COVID-19 Funding Award Number: 24-IHFA 186302 – Award Period: October 1, 2023 through September 30, 2024 Award Number: Aurora ARPA – Award Period: April 1, 2024 through December 31, 2024 Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Condition: Hours spent working on different funding sources/cost objectives from payroll timesheets did not agree to hours entered into the payroll allocation spreadsheets for five pay periods for sampled employees #1 and #2. Additionally, total hours worked and logged on timesheets did not agree to hours paid for two pay periods for sampled employees #1 and #3. These errors were not detected and corrected after-the-fact. Criteria: According to 2 CFR 200.303(a), non-Federal entities must 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. Per 2 CFR 200.430(i)(1), Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated Questioned Costs: Not determinable. Cause: The Organization’s established internal controls over salary and wage cost allocation did not operate as intended. Effect: Allowable costs could potentially be overpaid or underpaid or disallowed and required to be paid back to the Federal awarding agency (and/or pass-through entity). Recommendation: The Organization should strengthen their policies and procedures to support a system of internal control able to prevent and/or detect and correct errors timely ensuring costs are accurate, allowable, and properly allocated. Views of Responsible Officials and Planned Corrective Actions: Gateway Domestic Violence Services acknowledges there were errors made but can attest that the charges to funders were correct. See separately issued corrective action plan.

Corrective Action Plan

Gateway Domestic Violence Services, in 2024, was utilizing paper timesheets that included the funder allocation for each staff person. The funder allocations were then entered into QuickBooks spreadsheets. In February of 2025, we engaged with Paychex Payroll Services which utilizes simple online software built to streamline payroll and automate taxes. It does include a job costing process that allows for identifying payroll costs to be distributed appropriately to funders. This electronic payroll system decreases the chances of human error. Also in August of 2025, there is a change in personnel to Finance & Operations Director rather than Finance and Operations Manager. The new position comes with increased responsibilities and increased skills. This position will be responsible for reconciling payroll allocations from Paychex to Payroll allocations in QuickBooks to government funding reports to ensure accuracy. These changes along with the systems that we have had in place should help prevent this issue from being repeated.

Categories

Allowable Costs / Cost Principles

Other Findings in this Audit

  • 574142 2024-002
    Significant Deficiency
  • 1150583 2024-002
    Significant Deficiency
  • 1150584 2024-002
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
93.671 Family Violence Prevention and Services/domestic Violence Shelter and Supportive Services $48,565
14.231 Emergency Solutions Grant Program $38,219
97.024 Emergency Food and Shelter National Board Program $14,650
93.558 Temporary Assistance for Needy Families $13,914
21.027 Coronavirus State and Local Fiscal Recovery Funds $6,262
93.497 Family Violence Prevention and Services/ Sexual Assault/rape Crisis Services and Supports $1,707