Finding 617977 (2022-002)

2022-002 ? Material Weakness and Nonmaterial Noncompliance ? Allowable Costs Program: Coronavirus State and Local Fiscal Recovery Funds (CSLFRF) (ALN 21.027) ? United States Department of Treasury ? Commonwealth of Virginia Department of Accounts; Federal Award Year: 2022. Criteria: Office of Management and Budget's (OMB) Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, Subtitle A, Chapter II, Part 200, Subpart E ? Cost Principles subsection 200.430 ? Compensation ? Personal Services subsection (i) ? Standards for Documentation of Personnel Expenses subsection (1) states: ?Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (iv) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (v) Be incorporated into the official records of the non-Federal entity; (vi) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities (for IHE, this per the IHE's definition of IBS); (iv) Encompass federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity's written policy; (viii) Comply with the established accounting policies and practices of the non-Federal entity (See paragraph (h)(1)(ii) above for treatment of incidental work for IHEs.); and (ix) [Reserved] (x) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two (2) or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity.? Condition: For a sample of two (2) employees payroll costs selected for testing out of a population of ten (10) employees, both did not have sufficient support: * Two (2) weeks of one (1) employee?s overtime pay were not supported with a timesheet. * Four (4) weeks of sixteen (16) weeks for one (1) different employee were not supported with an approved time sheet. Cause: Employees and supervisors did not adhere to County time certification policies and procedures. Effect: Noncompliance may result in action by the grantor. Questioned Costs: $1,168 known questioned costs from a sample of personnel costs of $12,647 and a population of $500,000. Our sample testing of sixty (60) non-personnel transactions of $8,697 from a population approximating $2,420,000 noted no internal control or compliance findings. Recommendation: Hourly employees and those charging time to a grant should have approved timesheets/records prior to payroll certification and processing. Views of Responsible Officials and Planned Corrective Action: Management concurs with the recommendation. The noted lack of certifications as related to overtime was not consistent with policy. Payroll staff will reinforce the importance of overtime approvals and the associated pay support by supervisors.