Finding Text
2022-001: Advance Billings for Items of Cost Criteria and Condition: Advance billings of incurred costs are not allowed. Context: Audit procedures identified that accrued paid time off (PTO) is being billed monthly for all employees allocable to this federal award. Cause: As part of the month-end close, accrued PTO is allocated to all programs. The processes for accumulating costs to bill for reimbursement include these accruals, even though the costs have not been paid to employees. Effect: Accrued PTO is billed in advance of payment, based on the month currently billed. Recommendation: Procedures should be modified to ensure that only incurred and paid costs are being billed to federal awards for reimbursement.