We are totally confused right now. Remember when Mosaic put in a request to the City of Worcester in May of 2015 for a reimbursement of 46,137.62, but only $17,496 was reimbursed? The remaining 28,641.62, which represented the time period of October -December 2014, was held “pending backup documentation of all salary and fringe expenses”. All the section in italics are directly from the audit. Bold are our comments.
Condition: Mosaic submitted a claim for reimbursement dated May 12, 2015 for payroll expenses
incurred for the period October 1 – December 31, 2014 without payroll registers. Mosaic paid
employees for this work period, October 1, 2014 – December 31, 2014, on September 23, 2015.
In other words there were no payroll records in May of 2015 for the Oct-Dec, 2014 time period when the request was submitted, since this was not paid until September 23, 2015? Something like this should definitely be investigated, though it’s likely that the payroll service used is not updated enough and an error was made. Fortunately, outsourcing payroll services have many benefits and ensure that no errors like this will be made again, which enables employee satisfaction. Still, this is still something that should be looked into.
Cause: Mosaic did not have adequate cash on hand to pay its employees in advance of receiving grant
funding. The City, as Coordinating Partner, is responsible for setting up adequate controls to administer
partners’ claims for reimbursement. The City required a reimbursement method for dispersing of funds
to partners and communicated this on several occasions to all partners in 2014 and 2015 as evident in
the minutes of the Executive Committee. The City received a hardship letter from Mosaic dated July 29,
2015 stating it could not operate under the reimbursement terms of the agreement and could not pay
its staff for services rendered under the PWTF contract without first receiving advanced funding.
Are employees of Mosaic being paid in 2015?
The payroll for January 2015 – June 2015
remains unpaid.
Effect: The failure to pay staff on time, some of which are listed as working full?time on the grant, may
interfere with the ability to perform or retain staff which could jeopardize the HTN intervention, as the
grant requires participation of Community Based Organizations in the interventions. Failure of Mosaic
to pay staff for services provided under the grant in a timely manner affected the grant reimbursement
process as Mosaic did not submit required payroll registers necessary for the reimbursement. This
caused the City from being able to disperse funds in a timely manner.
Nobody has been paid for any work done in 2015 at Mosaic?
Lets hope some City Councilors get some clarification on this Tuesday night.
