Finding Text
Finding Number: 2022‐002
Repeat Finding: No
Program Name/Assistance Listing Title: COVID‐19 Coronavirus State and Local Fiscal Recovery Funds
Assistance Listing Number: 21.027
Federal Agency: U.S. Department of Treasury
Federal Award Number: ISA‐ARPA‐AZABGC‐042022‐47, GR‐GEER‐AZABGC‐040122‐01
Pass‐Through Agency: Arizona Alliance of Boys and Girls Clubs
Questioned Costs: $5,076
Type of Finding: Noncompliance, Significant Deficiency
Compliance Requirement: Activities Allowed or Unallowed, Allowable Costs/Cost Principles,
Period of Performance
Criteria
Under 2 CFR §200.303, the Club is required to establish and maintain effective internal controls over
Federal awards that provide reasonable assurance that the Club is managing the Federal award in
compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.
Condition
The Club did not have adequate internal controls in place to ensure eligible costs were charged to the
program.
Cause
The Club lacked proper internal controls over payroll and accounts payable processing.
Effect
The Club may have charged unallowable costs to the program.
Context
The Club did not maintain an approved wage agreement for two employees paid from the
grant. Therefore, it could not be determined if the wage rates charged to the grant were approved.
The questioned cost of $3,970 represents amounts paid to these employees, less what would have
been paid using the local minimum wage rate in effect for a similar number of hours worked. In
addition, the Club did not maintain supporting documentation for five of 40 non‐payroll expenditures
sampled that were charged to the grant, totaling $1,106. As a result, it could not be determined if the
purchases were allowable or expended within the period of performance. The aggregated projected
questioned cost for both items noted could be in excess of $25,000.
The sample was not intended to be, and was not, a statistically valid sample.
Recommendation
The Club should implement procedures over payroll and non‐payroll expenditures to ensure the
adequate maintenance of documents. These procedures should include maintaining approved wage
agreements for all employees and purchase approvals and third party invoices for non‐payroll
expenditures.
Views Of Responsible Officials
See Corrective Action Plan.