Finding Text
Federal Agency: U.S. Department of Transportation
Program/Cluster: Highway Planning and Construction
Federal Assistance Listing Number: 20.205
Pass-through: California Department of Transportation
Award No. and Year: STPCML-5132 (049) – 2022 and HSIPL-5132 (52) - 2022
Compliance Requirement: Special Tests and Provisions – Wage Rate Requirements
Type of Finding: Significant Deficiency in Internal Control over Compliance
Criteria:
Per 2 CFR 200.303, the non-Federal entity must establish and maintain effective internal control over the 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. This includes internal controls over maintaining records of the receipt and review of certified payrolls.
Condition:
We identified eleven (11) instances in which the City did not retain evidence to document the individual who reviewed the certified payroll for each week in which work was performed by construction contractors.
Cause:
The City’s procedures did not include documenting the review of the certified payroll received.
Effect:
Ineffective controls over this area of compliance could result in noncompliance with the wage rate compliance requirements.
Questioned Costs:
No questioned costs were identified as a result of our procedures.
Context/Sampling:
The population consisted of 104 certified payrolls required during the fiscal year. A sample of eleven (11) were selected for testwork.
Repeat Finding from Prior Year(s):
No.
Recommendation:
The City should establish controls to ensure there are procedures in place requiring the documented review of the certified payroll submitted by the construction contractors.
Views of Responsible Officials:
Management concurs with the finding. See separate corrective action plan.