Audit 19698

2022-002 Equipment and Real Property Management Information on Federal Program: National Science Foundation (NSF) Cooperative Agreement Management and Operations of the National Radio Astronomy Observatory, Long Baseline Array and Atacama Large Millimeter Array (ALMA) ALN #: 47.049 Award #: AST-1519126 Award Year: 10/01/2016 ? 09/30/2026 Criteria ? 2 CFR Section 200.313(d)(3), Equipment, requires that recipients of federal awards develop and maintain an internal control system to ensure adequate safeguards to prevent loss, damage or theft of property acquired with federal funds. In addition, any loss, damage, or theft must be investigated. Condition ? During the year ended September 30, 2022, AUI identified an incident of theft of copper mesh at the ALMA construction site. AUI did not have adequate internal controls to prevent theft of property acquired with federal funds. AUI had implemented a limited system of internal control during a period of time due to the COVID pandemic but these controls failed to prevent property theft. In addition, it took several months for AUI to discover the theft due to the limited number of personnel onsite during the pandemic. Questioned Costs ? Below reporting threshold. Context ? This is a condition identified through AUI?s internal review and audit processes and was reported during our internal control assessment for the year ended September 30, 2022. Effect or Potential Effect ? This condition could result in unallowable expenses being charged to the federal award. Repeat Finding ? This is not a repeat finding. Cause ? Due to the shutdown caused by the COVID pandemic, limited internal controls were implemented by AUI to secure the federal property. Recommendation ? We recommend AUI comply with the Equipment compliance requirement at all times and enhance its policies and procedures to ensure adequate safeguards to prevent loss, damage or theft of property acquired with federal funds. Views of Responsible Officials ? As noted above in the Condition section, the theft of the copper mesh (which had an approximate cost of around $3,200) occurred at the height of the COVID pandemic. Despite the reduced staff and remote location of the site, controls were in place during this time period that prevented any additional losses from occurring. Despite the theft being an isolated incident, AUI put additional internal controls in place to mitigate the risk of this type of occurrence from happening in the future. These controls are described in detail in the Management?s Corrective Action Plan included as Appendix A of the attached Management Prepared Document Section.

2022-002 Equipment and Real Property Management Information on Federal Program: National Science Foundation (NSF) Cooperative Agreement Management and Operations of the National Radio Astronomy Observatory, Long Baseline Array and Atacama Large Millimeter Array (ALMA) ALN #: 47.049 Award #: AST-1519126 Award Year: 10/01/2016 ? 09/30/2026 Criteria ? 2 CFR Section 200.313(d)(3), Equipment, requires that recipients of federal awards develop and maintain an internal control system to ensure adequate safeguards to prevent loss, damage or theft of property acquired with federal funds. In addition, any loss, damage, or theft must be investigated. Condition ? During the year ended September 30, 2022, AUI identified an incident of theft of copper mesh at the ALMA construction site. AUI did not have adequate internal controls to prevent theft of property acquired with federal funds. AUI had implemented a limited system of internal control during a period of time due to the COVID pandemic but these controls failed to prevent property theft. In addition, it took several months for AUI to discover the theft due to the limited number of personnel onsite during the pandemic. Questioned Costs ? Below reporting threshold. Context ? This is a condition identified through AUI?s internal review and audit processes and was reported during our internal control assessment for the year ended September 30, 2022. Effect or Potential Effect ? This condition could result in unallowable expenses being charged to the federal award. Repeat Finding ? This is not a repeat finding. Cause ? Due to the shutdown caused by the COVID pandemic, limited internal controls were implemented by AUI to secure the federal property. Recommendation ? We recommend AUI comply with the Equipment compliance requirement at all times and enhance its policies and procedures to ensure adequate safeguards to prevent loss, damage or theft of property acquired with federal funds. Views of Responsible Officials ? As noted above in the Condition section, the theft of the copper mesh (which had an approximate cost of around $3,200) occurred at the height of the COVID pandemic. Despite the reduced staff and remote location of the site, controls were in place during this time period that prevented any additional losses from occurring. Despite the theft being an isolated incident, AUI put additional internal controls in place to mitigate the risk of this type of occurrence from happening in the future. These controls are described in detail in the Management?s Corrective Action Plan included as Appendix A of the attached Management Prepared Document Section.