Finding Text
Criteria: Code of Federal Regulations ? 200.414 discusses the use of federally approved indirect cost rate agreements. Unless approved by the cognizant agency, organizations that have previously established indirect cost rates must submit a new indirect cost proposal to the cognizant agency for indirect costs within six months after the close of each fiscal year. The results of each negotiation must be formalized in a written agreement between the cognizant agency for indirect costs and the nonprofit organization. Condition: The Organization requested reimbursement for indirect costs using a previously expired indirect cost rate. Questioned Costs: $901. Context: The condition affected three of the four indirect cost transactions selected for testing. Cause: Turnover of staff resulted in using a previously expired indirect cost rate. Effect: Amounts were requested and reimbursed by the granting agencies in excess of the current indirect cost rate agreement. Repeat Finding: No. Recommendation: We recommend a member of management review, and document their approval, on the monthly expense reimbursement vouchers prior to them being submitted to ensure indirect costs are computed correctly. Views of Responsible Officials: There is no disagreement with the audit finding.