Finding Text
Condition: During our review of compliance over reporting, we found that the December 31, 2022 monthly invoices were not timely completed. In addition, the reports included indirect costs that did not have adequate support and therefore deemed unallowable in nature and excluded from the expenses reflected in the SEFA.
Criteria: Federal financial report submissions are required within a specific time frame as imposed by the grantor. There are mechanisms in place to identify risks of faulty reporting caused by such items as lack of current knowledge of, inconsistent application of, or carelessness or disregard for standards and reporting requirements of Federal awards. A supervisory review of reports is performed to assure accuracy and completeness of data and information included in the reports.
Cause: Internal controls over reporting compliance requirements were not properly designed and were not placed in operation. Management is responsible for compliance with requirements over Reporting and for the design, implementation, and maintenance of effective internal controls over compliance with the requirements of laws, statutes, regulations, rules, and provisions of grant agreements applicable to its federal program.
Effect: As a result of this condition, the December 31, 2022 monthly invoices were not timely completed and submitted to the appropriate funding agency.
Recommendation: We recommend BAIHP develop a policies and procedures manual for reporting compliance, which should include a checklist detailing all the necessary steps to ensure a proper submission of year-end invoices.