Audit 396152

Federal Program: Program Name: Integrated Ocean Observing System (IOOS) Assistance Listing: 11.012 Criteria: The Federal Funding Accountability and Transparency Act (“FFATA”), as implemented through 2 CFR Part 170, requires prime recipients of federal grants and cooperative agreements to report first-tier subawards of $30,000 or more, including amendments to subawards that increase the total obligated above the $30,000 threshold in a subsequent year, in SAM.gov (previously in the FFATA Subaward Reporting System (“FSRS”) through March 8, 2025) by the end of the month following the month in which the subaward was obligated. Accurate and complete subaward reporting is required to ensure transparency of federal spending. Failure to report timely constitutes noncompliance with the FFATA reporting requirement included in the OMB Compliance Supplement. Condition/Context: During testing of FFATA reporting requirements, we identified that the Association did not report any of the approximately fifty first-tier subawards meeting the reporting threshold under any of the three separate prime awards received under its cooperative agreement with the Integrated Ocean Observing System (“IOOS”) Office within the National Oceanic and Atmospheric Administration (“NOAA”). Cause: The Association was subject to FFATA reporting requirements under its cooperative agreement with the Integrated Ocean Observing System (“IOOS”) Office within the National Oceanic and Atmospheric Administration (“NOAA”). The cause of the FFATA reporting lapses was a requirements-interpretation gap in a cooperative agreement context, and management has agreed to promptly remediate and implement controls. The noncompliance resulted from a good-faith misunderstanding regarding the applicability of FFATA to cooperative agreements and did not stem from intentional misconduct or an overall deficient control environment. Effect: Failure to report subawards in FSRS/SAM.gov may reduce the transparency of federal spending and result in noncompliance with FFATA requirements. Incomplete federal reporting could impair the ability of oversight bodies to effectively track federal funds. NOAA/IOOS maintained visibility and comprehensive oversight through proposals (with subrecipient budgets), quarterly financial reports, semiannual performance reports containing subaward level detail, and annual amendment approvals under the cooperative agreement. These mechanisms provided effective oversight, notwithstanding FFATA lapses, and did not result in obscuring where funds went, impeding oversight, and or failing to provide information that would influence federal decision-making. Questioned Costs: None. FFATA reporting is a compliance requirement related to transparency, and no direct financial impact was identified. Repeat Finding: No Recommendation: We recommend the Association establish written internal controls, including procedures and tracking mechanisms to ensure timely FFATA reporting, as well as provide training to grants management personnel responsible for FFATA submissions to ensure timely and accurate reporting. Further, the Association should complete the FFATA reporting for the subawards promptly at the time a new subaward agreement for $30,000 or more is signed or when an amendment for a previous subaward increases the amount over the $30,000 threshold. Management Response: Management concurs with the finding. The Association acknowledges lapses in timely reporting of first-tier subawards in the FSRS/SAM.gov and gaps in internal controls, including procedure documentation, tracking of subaward obligation dates, and staff training. The Association is in the process of establishing written internal controls, including procedures and tracking mechanisms to ensure timely FFATA reporting, as well as providing training to grants management personnel responsible for FFATA submissions to ensure timely and accurate reporting. The overdue FSRS/SAM.gov reports will be submitted, and NOAA IOOS will be provided with documentation of completion. Management notes that all other financial and performance reporting requirements which included subaward information for the aforementioned subawards were filed timely.