Finding Text
Statement of Condition: Six expenditures of direct and indirect costs were inaccurately calculated by the Home. Criteria: Procedures should be established to ensure adequate separation of duties and review is performed on the calculation of direct and indirect costs. Cause: During 2022, the calculation of direct and indirect costs was conducted with minimal review. This environment was subject to human error in the performance of these calculations and respective drawdown of funds. Effect: The cost of assistance may be disallowed. Context: The test found six of sixty expenditures were not in compliance; with questioned costs totaling $254,173. Recommendation: The Home should segregate duties of measurement of direct and indirect costs, detailed review of measurement, and high-level review and drawdown to separate members of the accounting staff. Views of Responsible Officials and Planned Corrective Action: The Home agrees with the finding. The funds were drawn down from the grant due to human error. Shortly after discovering this mistake, The Home has developed a process in which the drawn down amounts is reviewed and approved before processing the drawdown. The amounts overdrawn were used to pay grant expenditures during FY2023, which still covers the grant budget period.