Finding 966530 (2021-002)

Federal Award Information: Name of Federal Agency: Department of the Treasury Federal Program Title: Coronavirus Relief Fund Assistance Listing Number: 21.019 Federal Award Year: 2021 Passed Through: State of California Department of Social Services Pass Through Number: COVID-19 TEFAP Criteria Section 5001 of the Coronavirus Aid, Relief, and Economic Security Act ("CARES Act") established the Coronavirus Relief Fund to provide assistance due to the COVID-19 public health emergency. Condition During our testing of payroll charged to the program, we noted formal documentation was not maintained to support payroll allocated to the grant. In addition, the Organization allocated net, rather than gross, pay to the grant throughout the year and posted an adjustment at year-end to correct wages and taxes. Cause Due to personnel turnover, documentation was not maintained and wages were not correctly allocated to the grant throughout the year. Effect Failure to maintain documentation supporting allocation percentages and using an incorrect allocation basis could lead to incorrect payroll amounts charged to grants. Questioned Costs No costs are questioned. Repeat Finding This is not a repeat finding. Recommendation We recommend the Organization develop a process to allocate payroll to grants, such as using actual hours worked for hourly employees and performing a time study for salaried employees, implement procedures to consistently allocate payroll to grants, and use the proper base for the allocation.