Martin Luther King, Jr. Family Clinic D/B/A Foremost Family Health

Health Center Program Cluster - Assistance Listing Number 93.224 U.S. Department of Health and Human Services Award No. 2 H80CS00127-23-00, February 1, 2024 - January 31, 2025 Criteria or specific requirement - Period of Performance (45 CFR 75.309) Condition - Costs charged to the grant award were incurred prior to the start of the period of performance. Cause - The Organization’s period of performance internal controls over payroll grant expenditures consider the pay date rather than accrual-based salary and wage expense and may easily be circumvented. Effect or potential effect - The Organization charged salaries and wages incurred prior to the beginning of the period of performance Questioned costs - $155,087. Questioned costs were determined by identifying salaries and wages incurred prior to the beginning of the period of performance based on payroll periods and pay dates. Context - Salaries and wages from pay periods paid in January 2024 and the first pay period paid during the period of performance were charged to the federal award, while all or a portion of these payroll costs were incurred as of January 31, 2024. Identification as a repeat finding, if applicable - Not a repeat finding Recommendation - The Organization should implement appropriate internal control procedures to verify grant expenditures are within the period of performance. The Organization should also implement cutoff procedures to ensure grant expenditures are captured on the accrual-basis consistent with period of performance compliance requirements and generally accepted accounting principles. Views of responsible officials and planned corrective actions - The Organization concurs with the finding and management will implement procedures to ensure appropriate internal control procedures are in place for period of performance and cutoff procedures related to grant expenditures. Management will implement additional internal controls at the end of the grant and the beginning of the grant to ensure accuracy of the salaries being posted are in the correct period of performance.