Finding Text
2022-002 ? Allowable Costs Federal program information: Funding Agency: U.S. Department of the Treasury Title: Coronavirus State and Local Fiscal Recovery Funds Assistance Listing Number: 21.027 Award Period: March 3, 2021 ? December 31, 2024 Criteria: To be allowable under Federal awards, costs must be necessary and reasonable for the performance and administration of the federal award. Costs must meet the following criteria: 1) necessary and reasonable; 2) consistent with policies and procedures; 3) accorded consistent treatment; and 4) are adequately documented. Condition: We noted the following in our review of expenditures: ? Two assistance checks were sent to a tribal member who was deceased. Once this was discovered, the Tribe issued another two checks to the individual?s beneficiary, resulting in the expense being charged to the program twice as the initial checks were not reversed or properly voided. An audit adjustment was needed to correct this error. ? For the payroll periods February 26, 2022 through March 11, 2022, we identified two instances where two employees? pay rates did not agree to their approved personnel action form effective for that payroll period. This was due to changes in pay not being properly reflected and dated on the personnel action form. Context: Three of forty-four expenditures. Questioned Costs: None. Cause: Internal controls are not in place to ensure expenditures are properly voided in the correct period. In addition, internal controls are not in place to ensure personnel action forms agree with the employee?s actual pay rate. Effect: The Tribe is not in compliance with federal allowable cost requirements. Auditors? Recommendation: Established policies and procedures should be enforced to ensure compliance with federal requirements. Ensure expenses are recorded only once to the federal program. Ensure personnel action forms are completed and approved before an employee?s pay rate is changed in the payroll system. Management Response: Management agrees with auditor?s recommendation, the Finance Manager will submit requests to void checks in the accounting system to the Accounts Payable Clerk. The Accounts Payable Clerk will process the void, and will submit an unposted transaction report of the voided check to the Finance Manager. The Finance Manager will verify that the check is being voided in the correct period, and then post the void to the general ledger. This process should ensure that all checks are voided accurately and timely. When the Council approves a pay increase for an individual(s), the Tribal Manager shall notify Human Resources in writing of the increase and the effective date of the increase for that employee. Human Resources will prepare a Personnel Action Form (PAF) using the information provided. The date of completion of the form will also be indicated on the PAF. One copy of the PAF will be placed in the employee?s Personnel File, and one copy of the PAF will be forwarded to the Payroll Clerk for entry into the accounting system. Employee rates will not be changed in the payroll system without a corresponding PAF.