FAC Explorer

Finding 60634 (2022-007)

Material Weakness
Requirement
AB
Questioned Costs
-
Year
2022
Accepted
2023-03-26
Audit: 56189
Organization: Great Plains Food Bank (ND)
Auditor: Eide Bailly LLP

AI Summary

  • Core Issue: There are significant payroll allocation errors that management failed to catch, leading to incorrect cost charges to programs.
  • Impacted Requirements: Internal controls over compliance are inadequate, specifically in the review process for payroll allocations.
  • Recommended Follow-Up: Implement a formal review and approval process for payroll allocations to prevent future errors.

Finding Text

2022-007 U.S. Department of Agriculture Federal Financial Assistance Listing # 10.565 All Awards Federal Financial Assistance Listing # 10.568 All Awards Food Distribution Cluster Activities Allowed/Unallowed and Allowable Costs/Cost Principles Material Weakness in Internal Control over Compliance Criteria ? A good system of internal controls includes a process to ensure that all costs are appropriately allocated to the programs. Condition ? As part of our audit, it was identified that there were multiple payroll allocation errors that were not identified by management. It was determined that some errors resulted in overallocation of costs while others in under allocation of costs. Cause ? No formal review was completed of the allocations before or after each payroll. This resulted in incorrect amounts being allocated to the programs. Effect ? The failure to adequately review payroll allocations resulted in incorrect charges to the program. Questioned Costs ? None Reported. Context/Sampling ? A nonstatistical sample of 8 pay periods out of a population of 26 pay periods were selected for testing. All 8 pay periods had an error. Repeat Finding from Prior Year(s) ? No. Recommendation ? It is recommended that the Organization implement processes and controls to ensure that payroll allocations are reviewed and approved with each payroll processed. Views of Responsible Officials ? Management agrees with the finding.

Corrective Action Plan

Finding 2022-007 U.S. Department of Agriculture CFDA # 10.565, 10.568 Food Distribution Cluster Finding Summary: As part of the audit done by Eide Bailly LLP, multiple payroll allocation errors to programs were identified. Responsible Individuals: Melissa Sobolik, CEO, David Stachon, CFO Corrective Action Plan: Effective April 2022, GPFB has outsourced payroll to PRO Resources and begun new processes to better document payroll allocations and mid- year changes. This outsourcing along with a more robust review process done by new staff will result in correct payroll going forward. Anticipated Completion Date: Completed

Categories

Allowable Costs / Cost Principles

Other Findings in this Audit

  • 60631 2022-004
    Significant Deficiency Repeat
  • 60632 2022-005
    Significant Deficiency
  • 60633 2022-006
    Significant Deficiency
  • 60635 2022-004
    Significant Deficiency Repeat
  • 60636 2022-005
    Significant Deficiency
  • 60637 2022-006
    Significant Deficiency
  • 60638 2022-007
    Material Weakness
  • 60639 2022-004
    Significant Deficiency Repeat
  • 60640 2022-005
    Significant Deficiency
  • 60641 2022-007
    Material Weakness
  • 60642 2022-004
    Significant Deficiency Repeat
  • 60643 2022-005
    Significant Deficiency
  • 60644 2022-007
    Material Weakness
  • 60645 2022-005
    Significant Deficiency
  • 60646 2022-005
    Significant Deficiency
  • 637073 2022-004
    Significant Deficiency Repeat
  • 637074 2022-005
    Significant Deficiency
  • 637075 2022-006
    Significant Deficiency
  • 637076 2022-007
    Material Weakness
  • 637077 2022-004
    Significant Deficiency Repeat
  • 637078 2022-005
    Significant Deficiency
  • 637079 2022-006
    Significant Deficiency
  • 637080 2022-007
    Material Weakness
  • 637081 2022-004
    Significant Deficiency Repeat
  • 637082 2022-005
    Significant Deficiency
  • 637083 2022-007
    Material Weakness
  • 637084 2022-004
    Significant Deficiency Repeat
  • 637085 2022-005
    Significant Deficiency
  • 637086 2022-007
    Material Weakness
  • 637087 2022-005
    Significant Deficiency
  • 637088 2022-005
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
10.569 Emergency Food Assistance Program (food Commodities) $3.16M
10.565 Commodity Supplemental Food Program $299,941
10.559 Summer Food Service Program for Children $154,767
10.568 Emergency Food Assistance Program (administrative Costs) $21,736
10.561 State Administrative Matching Grants for the Supplemental Nutrition Assistance Program $17,313