FAC Explorer

Finding 7902 (2022-003)

Significant Deficiency
Requirement
AB
Questioned Costs
-
Year
2022
Accepted
2024-01-08
Audit: 10307
Organization: Lifetime Independence for Everyone, Inc. and Subsidiary (TX)
Auditor: Carr Riggs & Ingram LLC

AI Summary

  • Core Issue: Two out of 25 payroll samples lacked supervisor approval on timecards, indicating a gap in internal controls.
  • Impacted Requirements: This violates 2 CFR section 200.303 on maintaining effective internal controls and 2 CFR section 200.430 regarding accurate payroll records.
  • Recommended Follow-Up: Implement stronger controls to ensure all payroll transactions are reviewed and approved by supervisors to prevent potential compensation errors.

Finding Text

ALN: 84.126 Federal Award Title: Rehabilitation Services Vocational Rehabilitation Grants to States Federal Agency: United States Department of Education Pass-Through Entity: Texas Health and Human Services Commission Award Number(s): HHS000186000005, HHS000202900008 Federal Award Year: 2022 Condition: During our review of payroll related transactions, 2 of the 25 payroll samples tested did not have review and approval of the Supervisor on the timecard. Criteria: 2 CFR section 200.303 – Internal Controls of the Uniform Guidance states that the nonfederal entity must: (a) Establish and maintain effective internal controls over Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Per 2 CFR section 200.430 – Compensation – personal services, paragraph (i) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. Effect: The Entity may unintentionally under/over compensate what is applicable for the work performed by that employee. This could lead to questioned costs and repayment of funds to the Grantor agency. Cause: The Entity does not have proper controls in place to verify that documentation was maintained to indicate the employees’ time paid under the federal grant. Questioned Costs: No questioned costs identified.

Corrective Action Plan

2022-003 – Payroll Time Approval – Significant Deficiency in Internal Controls over Compliance Recommendation: The Auditor recommends LIFE implement controls for documenting and retaining information to indicate the Entity follows the requirements over 2 CFR section 200.430(i), and that all time charged to the grant are reviewed for approval. Action Taken: LIFE Management will: • Review, update and adhere to established policies/procedures that align with the compliance of 2 CFR, 200.430(i). • Implement LIFE’s newly customized timekeeping system that enables accurate recording of time spent on grant-related activities and that ensures capabilities for supervisory review and approval. • Conduct training sessions for all staff to educate them about any updated policies regarding timekeeping procedures, the new online timekeeping portal and adherence to federal regulations. • Schedule internal audits and reviews, at minimum, once a fiscal quarter to ensure that the new timekeeping system is being used correctly and that all time charged to grants is appropriate and compliant with LIFE’s policies/procedures and federal regulations. Due Date of Completion: January 31, 2023 Responsible Official: Executive Director

Categories

Matching / Level of Effort / Earmarking Subrecipient Monitoring

Other Findings in this Audit

  • 7901 2022-002
    Significant Deficiency
  • 7903 2022-004
    Significant Deficiency
  • 7904 2022-002
    Significant Deficiency
  • 7905 2022-003
    Significant Deficiency
  • 7906 2022-004
    Significant Deficiency
  • 584343 2022-002
    Significant Deficiency
  • 584344 2022-003
    Significant Deficiency
  • 584345 2022-004
    Significant Deficiency
  • 584346 2022-002
    Significant Deficiency
  • 584347 2022-003
    Significant Deficiency
  • 584348 2022-004
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
93.432 Acl Centers for Independent Living $218,803
93.432 Covid-19: Acl Centers for Independent Living $137,715
84.126 Rehabilitation Services_vocational Rehabilitation Grants to States $100,270
93.369 Acl Independent Living State Grants $96,337
93.268 Immunization Cooperative Agreements $5,913