Criteria: The Code of Federal Regulations (CFR) Subpart E ? Cost Principles, ?200.430(i), allowable costs must be adequately documented. ?200.430(i)(1) states ?Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated?? Further, according to 29CFR ?516.5(b) records such as employment contracts or agreements must be retained by employers for at least three years from their last effective date. Condition: For 3 of 115 items tested, or 3% of the sample, we noted that the contract form was signed after the effective date of the renewal of employment. Cause: NMC staff who are responsible for monitoring contract form renewals did not review these personnel files in a timely manner. Effect: NMC did not comply with federal regulations requirements in which contract forms should be signed prior to renewal of employment. With this situation, the employee is working without properly documented approval from authorized personnel. Recommendation: NMC should ensure that human resources personnel adhere to the internal control policies and procedures relevant to renewal of employment. Ample time to process employment documents should be available to ensure that the required approvals are obtained prior to renewal of employment. Views of Responsible Officials See corrective action plan immediately following this schedule of findings and questioned costs.
Finding No. 2022 ? 001, Payroll (Renewal of Personnel Action) Auditee Response: Contact Person: David Attao, CFO Contact Information: david.attao@marianas.edu Completion Date: December 2023 The College partially agrees with this finding as the situation is unique to disputes that arise between the employee and supervisor during the employee personnel action renewal process. Personnel Actions are implied as renewed per employee contract terms. In order to resolve this finding, the College will update and revise NMC Procedure No. 5101.7: Employee Evaluations and NMC Procedure No. 5006.1: Employee Grievances to provide the supervisor and employee a 90 day grace period to conduct the evaluation, to add and engage a grievance process as needed, and to provide time for any dispute resolutions or negotiations. After such actions take place, a final decision must be reached at least 30 days prior to the contract's expiration date in the event of a non-renewal or renewal of personnel actions. Finding No. 2022 ? 002, Payroll (Contract Renewals) Auditee Response: Contact Person: David Attao, CFO Contact Information: david.attao@marianas.edu Completion Date: December 2023 The College partially agrees with this finding as the three contracts were implied as renewed per employee contract terms. To resolve this finding, the College will update and revise NMC Procedure No. 5101.7: Employee Evaluations and NMC Procedure No. 5006.1: Employee Grievances to provide the supervisor and employee a 90 day grace period to conduct the evaluation, to add and engage a grievance process as needed, and to provide time for any dispute resolutions or negotiations. After such actions take place, a final decision must be reached at least 30 days prior to the contract's expiration date in the event of a non-renewal or renewal of contracts. Finding No. 2022 ? 003, Payroll Auditee Response: Contact Person: David Attao, CFO Contact Information: david.attao@marianas.edu Completion Date: December 2023 The College partially agrees with this finding as it is related to Finding No. 2022-002. The three contracts were implied as renewed per employee contract terms. To resolve this finding, the College will update and revise NMC Procedure No. 5101.7: Employee Evaluations and NMC Procedure No. 5006.1: Employee Grievances to provide the supervisor and employee a 90 day grace period to conduct the evaluation, to add and engage a grievance process as needed, and to provide time for any dispute resolutions or negotiations. After such actions take place, a final decision must be reached at least 30 days prior to the contract's expiration date in the event of a non-renewal or renewal of contracts.
2021-005
For 1 of 90 items tested, or 1% of the sample, we noted that the personnel action form was signed after the effective date of the renewal of employment
Due to the outbreak of the COVID-19 Pandemic, the College faced many challenges, occasional closures, developed new working environments and had to conduct three audits within one and a half years. In such, the College partially agrees with this finding. In order to resolve this finding, the College created, secured, and reinforced the processing of contracts needed, including obtaining the necessary signatures from authorized personnel within the completion dates listed above
2020-005
SECTION III ? FEDERAL AWARDS FINDINGS Finding No. 2020-005, Payroll Federal Agencies US Department of Homeland Security Program Name Commonwealth Worker Fund CFDA No. 97.unknown Repeat Finding from Prior Audit? No Finding Type Significant deficiency Criteria: Personnel action forms must be reviewed and approved prior to renewal of employment. Condition: For 39 of 90 items tested, or 43% of the sample, we noted that the personnel action form was signed after the effective date of the renewal of employment. Cause: NMC staff who are responsible for monitoring personnel action form renewals did not review these personnel files in a timely manner. Effect: NMC did not comply with their payroll internal control requirements in which personnel action forms should be signed prior to renewal of employment. With this situation, the employee is working without properly documented approval from authorized personnel. Recommendation: Ample time to process employment documents should be given to achieve proper documentation and approvals. Views of Responsible Officials See corrective action plan immediately following this schedule of findings and questioned costs.
Finding No. 2020 ? 005, Payroll Auditee Response: Contact Person: David J. Attao, CFO Contact Information: david.attao@marianas.edu Completion Date: Completed (December 2020 through first two quarters of FY2021) This finding was similar to the payroll findings in FY2019, of which the College has taken the appropriate steps to resolve this matter. As the College was making improvements to ensure that contracts and personnel actions were executed in advance, the COVID-19 Pandemic reached the CNMI and caused adverse impacts throughout the Marianas and at NMC. One of these impacts was the delay of as efforts that were focused on creating new procedures to operate while still trying to correct past practices. The College partially agrees with this finding, however, to clarify, the 39 of 90 payroll items tested revealed that it involved only 3 employees who were undergoing the contract and personnel action renewal process. The 3 employees were found to have their personnel actions signed after the effective date but were paid 12, 9, and 18 times respectively while their personnel actions were being processed for renewal. All 3 of the employees had timesheets for each pay period which were used to document, verify, and enable their pay process. The College created the Personnel Actions needed to resolve this matter as well as reinstated the process of obtaining the necessary signatures from the authorized personnel in a planned and timely manner for all personnel actions.
For 103 of 120 items tested, or 86% of the sample, we noted that personnel action form was signed after the effective date.
Finding No. 2019 ? 005, Payroll Auditee Response: Contact Person: David J. Attao, CFO Contact Information: david.attao@marianas.edu Completion Date: December 2020 Due to the devastating and traumatic effects of Super Typhoon Yutu on the College?s physical and human resources including the total destruction of offices, buildings, lack of power, water, and full displacement of employees at the College, NMC partially agrees with this finding as processing of contracts and personnel actions were subject to delays. The College implemented a ninety (90) day or more performance review/evaluation/renewal process to help secure the proper documentation needed for contracts and/or personnel actions. The College plans to reinstate the prior approval and decentralized decision making processes to further assist with obtaining the necessary signatures from the authorized personnel in a planned and timely manner. In addition, no new employees may start employment without securing the appropriate approvals and documents. Employees with verified information will be paid according to what is listed on their approved contracts and corresponding personnel actions. Payments for inaccurate, incomplete contracts or personnel actions will be held until such documents are completed with the most updated and accurate information.
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