Audit 366831

Finding 2024-003 – Reporting U.S. Department of Commerce Economic Development Cluster ALN 11.307 Grantor Number 01-79-15312 Condition: The Organization did not comply with reporting requirements established under the Federal Funding Accountability and Transparency Act (FFATA) - one subaward was not identified and reported. Criteria of Specific Requirement: FFATA (as codified in 2 CFR parts 170) requires direct recipients of grants and cooperative agreements to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS) no later than the end of the month following the month in which the obligation was made. Questioned Costs: None Cause: The Organization does not have formal policies in place to identify subawards that require reporting in the FSRS as required under FFATA. Effect: The Organization was not in compliance with reporting requirements under FFATA. Identification as a Repeat Finding: This is a repeat finding. Recommendation: The Organization should develop and implement formal policies and procedures to ensure compliance with FFATA reporting requirements. This should include mechanisms to identify all first-tier subawards that meet the $30,000 threshold, track subaward activity, and ensure timely and accurate reporting to FSRS. Views of Responsible Officials and Planned Corrective Actions: Management agrees; see separate corrective action plan.

Finding 2024-004 – Subrecipient Monitoring U.S. Department of Commerce Economic Development Cluster ALN 11.307 Grantor Number 01-79-15312 Condition: The Organization does not have formal subrecipient monitoring policies and procedures in place to document the assessment of risk for subrecipients. Specifically, there is no documented review of subrecipient financial or performance reports, no formal risk assessments conducted prior to disbursement of funds, and no site visits or other monitoring activities to ensure compliance with award terms and federal regulations. In addition, the Organization does not have procedures in place to adequately review the subrecipient audits received, ensure that audit requirement language is included in each contract, or notify the subrecipient of the subaward ALN and amount that was paid during the year. Criteria of Specific Requirement: Pass-through entities are required to evaluate subrecipient risks of noncompliance as part of their subrecipient monitoring procedures. In addition, 2 CFR 200.332(d) indicates as part of the monitoring process, the pass-through entity should ensure subrecipients are notified of their requirement to receive an audit and take follow-up action on audit deficiencies, which would be identified as part of the review of the annual audit reports of subrecipients and 2 CFR section 200.332(a) required pass-through entities to notify the subrecipient at the time of the subaward of the subaward ALN and amount that was paid during the year. Questioned Costs: Unknown Cause: The Organization does not have procedures in place to document the assessment of risk for subrecipients. In addition, the Organization does not have procedures in place to adequately review all subrecipient audits or notify the subrecipient of the subaward ALN and amount that was paid during the year. Effect: The Organization was not in compliance with subrecipient monitoring requirements. Identification as a Repeat Finding: This is a repeat finding. Recommendation: The Organization should review all contract documents for conditions and terms, and based upon that review, implement procedures to ensure subrecipient monitoring includes proper risk assessment and monitoring of single audit compliance, along with any other grant requirements. Views of Responsible Officials and Planned Corrective Actions: Management agrees; see separate corrective action plan.