Finding 58713 (2022-001)

Material Weakness
Requirement
AB
Questioned Costs
-
Year
2022
Accepted
2023-07-23
Audit: 56659
Auditor: Wegner CPAS LLP

AI Summary

  • Core Issue: Lack of proper review and approval of cost allocation spreadsheets and employee time and effort, leading to potential non-compliance with federal requirements.
  • Impacted Requirements: Internal controls over federal awards as outlined in 2 CFR 200.303(a) are not effectively established or maintained.
  • Recommended Follow-Up: Implement monthly reviews of cost allocation and time/effort reports, update written procedures, and provide training for new grant management personnel.

Finding Text

Finding 2022-001 Assistance Listing Number(s): 10.558 Name of Federal Program or Cluster: Child and Adult Care Food Program Name of Federal Agency: Department of Agriculture Name of Pass-through Entity: Wisconsin Department of Public Instruction Criteria or Specific Requirement: Per 2 CFR 200.303(a) the organization 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. Condition and Context: During testing of allowable costs the following conditions were noted: ? The monthly cost allocation spreadsheets were not reviewed and approved to provide reasonable assurance that costs charged are allowable. ? 1 employee of 6 employees tested in a nonstatistical sample had time and effort that was not reviewed and approved to provide reasonable assurance that costs charged are allowable. Cause: Due to turnover at the executive director position and lack of written procedures the new executive director was unaware of the internal controls over compliance for allowability. Effect or Potential Effect: Costs charged to federal awards may not be allowable. Repeat Finding: This is not a repeat finding. Recommendation: ? Cost allocation spreadsheets should be reviewed and approved monthly by the executive director to provide reasonable assurance that costs charged are allowable. ? Time and effort should be reviewed and approved to provide reasonable assurance that costs charged are allowable. ? Written procedures for allowable costs should be updated to include internal controls performed by the executive director and training should be provided to new personnel responsible for grant management. Views of Responsible Officials: Community Coordinated Child Care, Inc. agrees with the finding.

Corrective Action Plan

CORRECTIVE ACTION PLAN Year Ended December 31, 2022 Community Coordinated Child Care, Inc. (4-C) respectfully submits the following corrective action plan for the year ended December 31, 2022 Name and address of independent public accounting firm: Wegner CPAs 2921 Landmark Place Suite 300 Madison, Wisconsin 53713 Audit period: January 2022 ? December 2022 The findings from the December 31, 2022, schedule of findings and questioned costs are discussed below. The findings are numbered consistently with the numbers assigned in the schedule. FINANCIAL STATEMENT FINDINGS Finding 2022-001 During testing of allowable costs the following conditions were noted: ? The monthly cost allocation spreadsheets were not reviewed and approved to provide reasonable assurance that costs charged are allowable. ? 1 employee of 6 employees tested in a nonstatistical sample had time and effort that was not reviewed and approved to provide reasonable assurance that costs charged are allowable. Recommendation ? Cost allocation spreadsheets should be reviewed and approved monthly by the executive director to provide reasonable assurance that costs charged are allowable. ? Time and effort should be reviewed and approved to provide reasonable assurance that costs charged are allowable. ? Written procedures for allowable costs should be updated to include internal controls performed by the executive director and training should be provided to new personnel responsible for grant management. Action Taken DocuSign Envelope ID: ACAB2B66-E966-4B71-ADAC-68C66A23756D ? Cost allocation spreadsheets are now reviewed and approved monthly by the Executive Director. ? Time and effort for exempt employees are now reviewed and approved. ? Written procedures for payroll have been updated to include internal controls performed by the Executive Director. FEDERAL AWARD FINDINGS See finding 2022-001. If there are questions regarding this plan, please call Rebecca Strome, Business Manager, at 608-271-9181.

Categories

Allowable Costs / Cost Principles Subrecipient Monitoring Matching / Level of Effort / Earmarking

Other Findings in this Audit

  • 635155 2022-001
    Material Weakness

Programs in Audit

ALN Program Name Expenditures
10.558 Child and Adult Care Food Program $1.69M
93.575 Child Care and Development Block Grant $1.28M
93.434 Every Student Succeeds Act/preschool Development Grants $187,106
14.218 Community Development Block Grants/entitlement Grants $124,000