Finding Text
Finding Number 2023-006
Assistance Listing Number 84.425 - Education Stabilization Fund
Allowable Costs/Cost Principles - Documentation of Employee Time and Effort
Material Weakness in Internal Control over Compliance
Material Noncompliance
Criteria: Per Federal regulations CFR Title 2, Part 200 Section 200.430 (i)(1), charges to federal
awards for salaries and wages must be based on records that accurately reflect the work performed.
Condition: The School District did not maintain time and effort distribution records for two
employees whose salaries, wages and benefits were charged to the federal award program.
Cause: Accounting department turnover lead to incomplete record keeping and lack of knowledge on
the federal requirement requiring accounting records to support salary, wage and benefit allocations.
Effect: As a result of this condition, salaries, wages and benefits may be charged to the federal award
program that are not supported by time and effort distributions.
Questioned Costs: Known questioned costs are $77,244, and likely questioned costs are $130,610.
Context: This finding relates to two employees whose salary, wages and benefits are charged 100%
to this federal award program, however, the School District simply did not obtain an after-the-fact
determination of their time and effort in accordance with the federal requirements.
Recommendation: Salaries, wages and benefits allocations must be supported by time and effort
documentation. This can be accomplished by obtaining semi-annual certifications, personal activity
reports or weekly timecards from employees. We recommend management review employee
allocations to ensure an after-the-fact determination of actual time spent is obtained from all
employees charged to federal award programs.