Finding Text
2021-005 – Allowable Costs/Cost Principles
Federal Program Information:
ALN - 66.458 - Clean Water State Revolving Funds
Criteria: The following CFR(s) apply to this finding: 2 CRF 200.303
Condition: During audit procedures, it was identified that the Town does not have
invoice’s and board warrants approved before issuing checks.
Cause: The Town does not have the necessary internal controls over compliance. Lack
of supervisory oversight.
Effect: Expenses may not be properly allocated to the grant; this could result in
unallowable expenses being charged and subsequently improperly reimbursed by
federal funds
Identification of Questioned Costs: None identified.
Context: The population selection consisted of 12 out of 16 transactions were
examined. Of the 12 samples, 12 did not have management approval and 7 did not
document board approvals to ensure that only allowable costs were being charged to
the program and 8 out of 12 invoices were over 30 days late.
Repeat Finding: This is not a repeat finding.
Recommendation: It is recommended that the Unit develop and implement policies and
procedures for documented approval process to ensure that only allowable costs are
charged to the program.
Views of Responsible Officials and Corrective Action Plan: Client agrees with finding,
and a version of their response can be found in the Corrective Action Plan. Please see
the Corrective Action Plan issued by the Town of Livermore Falls.