Audit 411825

Criteria – 2 CFR 200.305(b) requires recipients and subrecipients other than States, to minimize the time elapsing between the transfer of funds from the Federal agency or pass-through entity and the disbursement of funds by the recipient or subrecipient regardless of whether the payment is made byelectronic funds transfer or by other means. Condition – NICJR did not minimize the time elapsed between the drawdown of funds and payment of related expenditures in accordance with 2 CFR 200.305(b). Context – NICJR did not pay expenses prior to requesting a transfer of funds from the federal agency, did not minimize the time elapsed between payment and request of funds, and did not calculate interest earned on any advanced payments. Cause – NICJR does not have formal policies and procedures in place to minimize the time elapsing between transfer of funds and related disbursements. Effect – The federal agency paid down funds to NICJR before costs were paid. NICJR has not met the Cash Management requirements of 2 CFR 200.305(b). Questioned costs – None Repeat Finding – This is not a repeat finding. Recommendation – We recommend NICJR enhance policies and procedures to minimize the time elapsed between payment and request of funds. Management’s response - NICJR’s drawdowns were due to extraordinary circumstances. There was an unprecedented action taken by the federal government in announcing the pending cancellation of more than $800 million grants to thousands of non-profit organizations around the country. During the significant uncertainty surrounding the changing funding environment, as well as our commitment to our subgrantee organizations, NICJR continued submitting reimbursement requests while awaiting additional guidance. NICJR will create a cash management policy to minimize the time elapsed between payment and request of funds to meet requirements of 2 CFR 200.305(b).