State auditor scolds WorkForce Central over inadvertent job fair accounting error

It appears the Tacoma-Pierce County Employment and Training Consortium WorkForce Central has run afoul of the Office of Management and Budget’s Circular A-87 (2 CFR Part 225) Appendix B.

So proclaims a report issued Monday by the Washington State Auditor’s Office.

The problem, according to the report, concerns two job fairs held in 2013 where the consortium “received payments from sponsors that were used to offset the costs of each event. Payments from sponsors are considered program income, which is subject to the federal cost principles.”

Under “Cause of Condition,” the report states, “Consortium staff were unaware the revenue received for the two job fair events were considered federal WIA program income and the expenditures of these funds were considered federal expenditures subject to cost principles.”

The report questioned $15,008 in unallowable costs.

In short: Sponsors paid money to help people find jobs; WorkForce Central used the money as it said it would, to present a pair of job fairs and to buy tickets to a baseball game for people who participated; the money was wrongly booked, according to accepted accounting principles.

Guilty as charged.

“We have taken steps to correct it,” said WorkForce CEO Linda Nguyen on Monday.

The accounting error, she said, “was inadvertent. Staff didn’t understand how to book these dollars appropriately. It’s good that the auditor’s office came to clarify it.”

The report found no “significant deficiencies” and no “material weaknesses” either in WorkForce financial statements or in the agency’s internal controls.

In a formal response to the auditor’s report, WorkForce Central said it “now recognizes that this was an incorrect method of accounting for the revenue and expenditures. All revenue and expenditures from the job fairs will be immediately reclassified.”

Plus, WorkForce said it “has restructured its protocol for the accounting coding of all job fairs.”

“Our remarks at the end (of the report) are a good indication that there’s no contention here,” said Thomas Shapley, spokesman for the Auditor’s Office, on Monday.

Those remarks note: “We appreciate the Consortium’s commitment to resolve this finding. We thank the Consortium for bringing this issue to our attention and for its cooperation and assistance during the audit.”

Said Shapley, “That says a lot.”