Finding Text
2023-004 Allowable Costs: Improve Processes Over Review and Approval of Expenditures.
Federal Program Information: Activities to Support State, Tribal, Local and Territorial Health
Department Response to Public Health or Healthcare Crises (Assistance Listing #93.391)
Condition and Criteria: The Foundation’s internal processes state that the monthly Financial
Status Reports (“FSRs”) submitted to the Foundation by subrecipients should be reviewed by
an individual familiar with the program to ensure costs are allowable and all supporting
documentation has been submitted prior to entry of transaction into QuickBooks, and that all
timesheets should be approved prior to allocation of time to programs prior to entry into
QuickBooks. However, these processes were not followed consistently throughout the year.
Prior Year Audit Finding: N/A
Cause and Effect: There were several instances in which the monthly FSRs submitted to the
Foundation by subrecipients were not properly reviewed and authorized by the Foundation
prior to payment to subrecipients. Additionally, there was one instance noted for which the
time sheet was not properly approved prior to entry. If these expenditures are not allowable,
this could result in noncompliance with federal allowable costs guidelines, and could result in
the loss of federal funding.
Context: This represents a systemic problem.
Questioned Costs: None. Recommendation: All costs related to expenditures of federal funds should be reviewed and
approved by an individual familiar with the program requirements. This will ensure costs are
allowable, and the Foundation is not at risk of noncompliance, which could result in the loss of
federal funding.
Management’s Response: Going forward, management will have someone who is
knowledgeable of federal activity review and approve all federal expenditures and allocations,
including those relating to subrecipient FSRs. A new CFO was hired during FY24, who will be
reviewing all internal controls and processes for needed updates, as well as monitor activities to
prevent any unauthorized transactions or potential unallowable costs.