Finding Text
Condition: A sample of forty (40) payroll transactions were selected for testing, spanning across five (5)
months. For one month selected, the Foundation was unable to provide key payroll reports to reconcile
payroll to the amount charged to the federal program.
Criteria: The Uniform Guidance requires organizations to establish internal controls to detect potential
noncompliance.
Cause: Overall lack of policies and procedures regarding retention of documentation. Management believes
the payroll report was overwritten by a subsequent month.
Effect: Noncompliance with the federal award program’s allowance costs compliance requirements could
occur and not be detected and corrected timely.
Recommendation: We recommend that the Foundation establish procedures to back up all pertinent payroll
reports to a secure location to prevent loss of data.
Views of Responsible Officials and Planned Corrective Actions: A previous staff member (who is no longer
with the Foundation) appears to have erroneously overwritten a payroll report. We now have a process
where each month, a payroll folder is created with the correct reports and supporting documents. Once
again, this process is in place with documentation. As part of our collation process, these will be gathered
into a procedural manual.