Finding Text
Assistance Listing Numbers 93.224 and 93.527 – Health Center Program Cluster
Award Numbers: H80CS00112, H8CCS34790, H8DCS36181 and H8ECS38688
Compliance Requirement: Allowable Costs/Cost Principles
Type of Finding: Material Weakness
Condition and
Context:
Five individuals were selected to review personnel files and payroll related to salary for
the Organization. Of the five files reviewed, one file support could not be located to
verify existence.
Criteria: Uniform Guidance Allowable Costs/Cost Principles addresses activities related to
salaries for the Organization which should be properly supported by internal controls to
ensure that personnel documentation properly supports the salaries that were paid to
qualified individuals and that compensation to individual employees must be
reasonable for the services rendered.
Effect: There was exposure which could have resulted in errors occurring in the payroll that
was incurred during the year.
Cause: The Center did not have a formal policy to retain documentation of approved wage
rates for all employees.
Questioned
Costs:
$97,115
Repeat Finding: Repeat finding of 2019-005
Recommendation: The Organization’s human resources staff should use a checklist to ensure that all
necessary documents are kept in the personnel files, including applications or
resumes, approved pay rate, Form I-9, and Form W-4.
Views of
Responsible
Official:
Management of the Organization concurs with the audit finding