Finding Text
Federal Agency: U.S. Small Business Administration
Federal Program: 59.075 Shuttered Venue Operators Grant Program
Identification Number: SBAHQ21SV012046.2
Requirement: Activities Allowed or Unallowed
Type of Finding: Significant deficiency in internal control over major program
Criteria: Charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one federal award; a federal award and non-federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using difference allocation bases or an unallowable activity and a direct or indirect cost activity.
Condition: Support for payroll costs claimed under the program was not maintained for all pay periods.
Cause: Management did not maintain the electronic support for each pay period.
Effect: Failure to maintain support for costs claimed may result in inquiries by the federal entity to those charged with governance.
Context: During the height of the COVID-19 pandemic, the Box Office Manager would email the Executive Theater Manager the employees’ weekly hours worked in lieu of a physical timesheet. Out of five pay periods tested, one pay period did not have email correspondence to support the employees’ time.
Recommendation: Email correspondence used in the approval process of any costs should be maintained in the same manner as physical invoices or timesheets.
Views of Responsible Official(s) and Planned Corrective Actions: See corrective action plan.