Semi-annual effort certifications prepared for the SNAP program at the Urbana campus are not in accordance with federal regulations.
The University has established offices in 77 counties in the State of Illinois to administer and deliver the training and educational programs under the SNAP program. Although the program’s activities are coordinated centrally by personnel at the Urbana campus, the University’s staff that operate the program’s activities are not under the direct supervision of the program coordinator. During our review of the semi-annual expenditure certifications process for employees whose payroll and fringe benefits were charged to the SNAP program, we noted the two semi-annual certifications covering the year ended June 30, 2009 were signed by the program coordinator, rather than by an individual possessing direct knowledge of each employee’s activities. Because of the decentralized nature of the SNAP program’s operations and these individuals work on multiple activities (projects), we believe it is unlikely the program coordinator is in the position to have the direct knowledge required to certify on behalf of all personnel performing program activities.
Payroll, fringe benefits, and related indirect cost expenditures charged to the SNAP program for employees of the Urbana campus were approximately $4,918,000 for the year ended June 30, 2009.
OMB Circular A-21, Cost Principles for Higher Education Institutions, establishes principles and standards for determining costs for federal awards carried out through grants, cost reimbursements contracts, and other agreements with higher education institutions. To be allowable under federal awards, costs must meet certain general criteria. Those criteria, among other things, require that the expenditures must be allocable, reasonable, and supported by adequate documentation. OMB Circular A-21 section J(10)(b)(2)(b) requires that the distribution of salaries and wages represent actual costs and be confirmed by responsible persons with suitable means of verification that the work was performed.
Additionally, OMB Circular A-110, Uniform Administrative Requirements for Grant and Agreements with Institutions of Higher Education, Hospitals, and Other Non-Profit Organizations, requires nonfederal entities receiving federal awards establish and maintain internal control designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Effective internal controls should include procedures to ensure payroll expenditures are properly certified in accordance with OMB Circular A-21.
In discussing these conditions with University officials, they stated that semi-annual certifications for the SNAP
Failure to ensure semi-annual expenditure certifications are signed by an individual with direct knowledge of the activities of the individuals for whom effort is being certified may result in expenditures being inappropriately charged to the federal program which are unallowable costs. (Finding Code 09-07)
Recommendation:
We recommend the University implement procedures to ensure semi-annual expenditure certifications are signed by individuals with direct knowledge of the activities of the employees to which the certifications pertain.
University Response:
Not accepted. Effort certifications prepared for the Supplemental Nutrition Assistance Program (SNAP) are in accordance with federal regulations. Per OMB Circular A-21, Section J.10.c.(2).(c). “To confirm that the distribution of activity represents a reasonable estimate of the work performed by the employee during the period, the reports will be signed by the employee, principal investigator, or responsible official(s) using suitable means of verification that the work was performed.”
The semi-annual confirmations for this program are reviewed for accuracy and signed by the Principal Investigator (PI), who is also the program coordinator. The PI has extensive personal knowledge of the program and staff activities, derived by using suitable means of verification that the work was performed which includes:
communicating with the county directors through frequent teleconference, e-mail, and face-to-face status meetings. The PI also conducts frequent site visits to each extension office, and has personal contact with every extension employee. The PI knows each employee by name and has an in-depth knowledge of their extension office activities.
Additional sources of information the PI utilizes are the monthly review and approval of all Payroll Labor Distribution reports and the monthly activity reported on “Form B” which is required to be completed by all SNAP staff. Data on Form B includes the date, time, hours worked, and number of program contacts initiated.
The Form B reports are posted monthly to the Extension intranet. The PI has access to the reports and can easily see the effort and program activity for each staff person.
The PI is also able to use input from the PRES (previously SEMIS) reporting system to verify staff activity. The PRES system is used by staff to keep regular daily activity records; it was developed to fulfill federal USDA activity/contact reporting requirements for Extension employees. The system is used to track activity associated with a variety of Extension programming and includes specific object codes designated for Food Stamp Nutrition Education program.
A Management Review of this program was conducted by the IDHS Chief of the Bureau of Homeless Services and Supportive Housing who evaluated the performance, the results of the program, and the ability of the Principal Investigator. The report stated, “Staff time records were kept in accordance with the USDA FSNE [now SNAP] program requirements. Staff duties were consistent with the plan. Activities undertaken by UIUC do not supplant nor duplicate existing nutrition education programs.” It also stated the program “has a ledger listing all employees, their wages and fringes showing the amount charged to the program either through a percentage of a “total” or detailed by program with a total. This includes: a) Personnel activity reports for all employees contributing less than 100% of their time; b) Semi-annual approvals of individuals contributing 100%
of their time.”
The summary of the report stated the UIUC program is administered very well and “the tracking system employed by the UIUC is exceptional.” There were no recommendations or findings or required corrective actions.
Auditors’ Comment:
As noted in the finding above, the program operations for SNAP are decentralized in 77 counties throughout the State of Illinois. Substantially all of the employees work on multiple federal and non-federal programs (activities). Accordingly, we believe it is unlikely the program coordinator is in a position to have sufficient knowledge to certify on behalf of all personnel performing program activities at more than 77 separate locations.
Federal Agency: US Department of Agriculture (USDA)
Program Name: Supplemental Nutrition Assistance Program (SNAP) CFDA # and Program Expenditures: 10.551/10.561 ($8,061,545) Award Numbers: 81X6287000
Questioned Costs: Cannot be determined