Finding 6488 (2023-001)

Condition: Family Pathways included sales tax in award expenditures. This was determined by viewed disbursement records,noting certain invoices where the Organization's exemption from sales tax was not properly obtained from vendors. Criteria:The Uniform Guidance allows and disallows certain costs for grant expenditures. Sales tax is not allowed (per 45 CFR75.470(b)(1)(I)). Questioned Costs: Known questioned costs are $61 related to supplies and food purchases. Context We tested 40 transactions charged to the grant. We noted 3 transactions charged to the grant that included sales tax. Cause:Family Pathways has been transitioning staff and updating disbursement policies and practices. Prior employees were not aware of the requirements. Staff are redesigning and implementing policies to address issues as they arise. Effect:Costs noted in "questioned costs" were charged to the grant that should not have been charged. Recommendation: The Organization and staff understand the finding and take appropriate action. We recommend that the staff continue to ensure that unallowable costs are ducted before being allocated to grants.