Finding 961031 (2022-002)

Significant Deficiency
Requirement
AB
Questioned Costs
$1
Year
2022
Accepted
2024-03-26

AI Summary

  • Core Issue: FSA failed to maintain adequate documentation for payroll costs related to the Emergency Solutions Grant, leading to noncompliance.
  • Impacted Requirements: 2 CFR 200.403(g) requires that costs must be properly documented to be considered allowable.
  • Recommended Follow-Up: FSA should establish procedures for all employees to maintain detailed timecards or time studies for federal program payroll claims by April 2024.

Finding Text

2022-002 - Emergency Solutions Grant - Assistance Listing No. 14.231 Significant Deficiency in Internal Control Over Compliance and Noncompliance – A. Activities Allowed or Unallowed and B. Allowable Costs/Cost Principles Criteria: 2 CFR 200.403(g) indicates costs must be adequately documented in order to be considered allowable. Condition and Context: During 2022, FSA maintained payroll records which included detailed timecards or time studies for employees who spent hours worked on the Emergency Solutions Grant (ESG). We selected 8 employees for testing during the audit and noted that 2 employees did not maintain detailed timecards or a time study and 3 employees worked less hours on ESG than what were claimed for reimbursement under the grant. Our sample was not considered to be a statistically valid sample. Cause and Effect: We noted a lack of internal controls surrounding the tracking of hours worked for ESG during 2022 which resulted in noncompliance. We tested 8 employees for a total of $14,431 of claimed payroll cost and calculated known questioned costs of $2,196 which resulted in likely questioned costs of $8,703 using an error rate of 15% over total payroll claimed for 2022 of $57,188. Total likely questioned costs were 2% of overall ESG expenditures for 2022. Recommendation: We recommend FSA implement procedures for all employees who have payroll claimed under federal programs to maintain detailed timecards or time studies to support hours worked under each federal program. Views of Responsible Officials and Planned Corrective Actions: Family Service Association of Howard County, Inc.’s (FSA) accounting department experienced significant turnover during 2022 which included the Director of Accounting leaving mid-year. Since the new Director of Accounting took on her role we have been actively working on ways to enhance our processes. Family Service Association of Howard County, Inc. (FSA) will implement procedures and maintain timecards and time studies for employees who have payroll claimed under the federal programs to be in compliance of federal grants beginning April 2024.

Categories

Questioned Costs Allowable Costs / Cost Principles

Other Findings in this Audit

  • 384588 2022-002
    Significant Deficiency
  • 384589 2022-002
    Significant Deficiency
  • 384590 2022-003
    Significant Deficiency
  • 961030 2022-002
    Significant Deficiency
  • 961032 2022-003
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
14.231 Emergency Solutions Grant Program $325,782
14.267 Continuum of Care Program $158,342
16.575 Crime Victim Assistance $62,291
16.017 Sexual Assault Services Formula Program $44,296
14.228 Community Development Block Grants/state's Program and Non-Entitlement Grants in Hawaii $41,826
97.024 Emergency Food and Shelter National Board Program $29,896
14.218 Community Development Block Grants/entitlement Grants $27,170
93.671 Family Violence Prevention and Services/domestic Violence Shelter and Supportive Services $16,046
93.667 Social Services Block Grant $12,600
93.569 Community Services Block Grant $770