Finding 979806 (2023-002)

Finding 2023-002 – ACTIVITIES ALLOWED OR UNALLOWED and ALLOWABLE COSTS/COST PRINCIPLES Type: Significant Deficiency in Internal Control / Noncompliance Program: Health Center Cluster (ALN 93.224) Condition: Expenditures charged to the grant were not authorized in the grant budget. Criteria: As detailed by 2 CFR 200.402, “The total cost of a Federal award is the sum of the allowable direct and allocable indirect costs less any applicable credits.” Cause: Management’s misunderstanding of costs allowed under this grant. Effect: Costs were charged to the grant in excess of approved budgets. Context: Amounts expended for 1 of 3 grant categories exceeded the approved budget for that category. Recommendation: We recommend that the CMHSP review all grant agreements to gain a thorough understanding of allowable costs and then establish internal controls to assure that only allowable costs are charged to the grant. Management’s Resp: We are in agreement with this finding.