Finding Text
2023-001 – Allowable Costs relating to Time and Effort and Internal Controls
Information on the Major Federal Program
U.S. Department of Health and Human Services
Name of Program: Substance Abuse and Mental Health Services
Assistance Listing Number: 93.243
Grant Award Number: 1H79TI085239-01/6H79SM080760-03M001/1H79TI084237-01/
1H79SM080760-01
Grant Award Period: September 30, 2022 to September 29, 2027,
November 30, 2018 to November 29, 2023, September 30, 2021 to September 29, 2026/
November 30, 2018 to November 29, 2023
U.S. Department of Veterans Affairs
Name of Program: Veterans Supportive Housing Per Diem Program
Assistance Listing Number: 64.024
Grant Award Number: VOAQ754-1291-558-PD-21, VOAQ754-2080-558-CM-22,
VOAQ754-2286-565-CM-22
Grant Award Period: October 1, 2022 to September 30, 2023
Criteria or Specific Requirements – In accordance with 2 CFR Section 200.430.8(i), charges to federal awards for salaries and wages must be based on records that reflect the actual work performed. The charges must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated, and must be incorporated into the official records of the non-Federal entity.
Condition - Several charges to Federal awards for salaries and wages were not supported with properly completed time sheets and in certain instances, approval of the timesheets by individuals knowledgeable of the federal program were not documented.
Cause - While there is a time keeping system implemented to track daily hours worked by employees, the Organization’s current internal control system over payroll is not consistently followed to produce properly completed time sheets nor proper supervisory approval of timesheets.
Effect - Charges to Federal awards for salaries and wages may not reflect accurate time worked.
Questioned costs - None
Context - We selected 64 salary transactions charged to the federal programs to test controls over allowable costs. Out of the 64 transactions tested, there were 15 instances where controls did not operate effectively, i.e., timesheets were not properly completed to reflect correct number of days worked or timesheets were not properly approved by the employees’ supervisors.
Repeat finding - No
Recommendation - We recommend the Organization consistently enforce its internal controls over payroll to ensure that all timesheets are properly and timely completed and reviewed and verified by appropriate personnel for accuracy.
Views of Responsible Officials - Management agrees with the federal award finding identified in the audit and effective immediately, will implement necessary procedures as described under the corrective action plan to address the finding.
Effective immediately, the Organization will strictly enforce its policy for employees to properly complete their timesheets and for supervisors to properly review and approve employees’ timesheets. To do this, the Organization will conduct a training for all employees and supervisors about how to properly complete and review timesheets. To ensure compliance with the policy, the Organization will conduct random checks of timesheets every pay period to verify that supervisory approval is performed. Appropriate disciplinary action will be implemented for non-compliance.