2023–054 INTERNAL CONTROLS OVER TRANSPARENCY ACT REPORTING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Homeland Security Disaster Grants – Public Assistance (Presidentially Declared Disasters) 97.036/COVID-19 97.036, Grant Award FEMA–4273-DR–WV, Grant Award FEMA–4331-DR–WV, Grant Award FEMA–4359-DR–WV, Grant Award FEMA–4378-DR–WV, Grant Award FEMA–4455-DR–WV, Grant Award FEMA–4517-DR–WV, Grant Award FEMA–4603-DR–WV, Grant Award FEMA–4605-DR–WV Criteria or specific requirement (including statutory, regulatory or other citation): 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: For 21 of the 31 subawards selected for testing, the West Virginia Division of Emergency Management (DEM) did not review and approve the Federal Funding Accountability and Transparency Act (FFATA) reports that were submitted to Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Cause: DEM does not have adequate internal controls in place to ensure that subawards of $30,000 or more are being reported timely and accurately to FSRS. Effect or Potential Effect: DEM may report inaccurate or untimely information for first-tier subawards of $30,000 or more causing them not to be in compliance with federal reporting requirements. Questioned Costs: N/A Context: Total federal expenditures and total subrecipient expenditures for the Disaster Grants – Public Assistance (Presidentially Declared Disasters) program were $123,949,127 and $65,999,232, respectively, for the year ended June 30, 2023. Identification as a Repeat Finding: Prior Year Findings 2022–042 and 2021–041 Recommendation: We recommend that DEM strengthen internal controls over FFATA reporting to ensure they are in compliance with federal reporting requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2023–055 SUBRECIPIENT MONITORING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Homeland Security Disaster Grants – Public Assistance (Presidentially Declared Disasters) 97.036, Grant Award FEMA–4273-DR–WV, Grant Award FEMA–4331-DR–WV, Grant Award FEMA–4359-DR–WV, Grant Award FEMA–4378-DR–WV, Grant Award FEMA–4455-DR–WV, Grant Award FEMA–4517-DR–WV, Grant Award FEMA–4603-DR–WV, Grant Award FEMA–4605-DR–WV Criteria or specific requirement (including statutory, regulatory or other citation): 2 CFR 200.303 requires that the West Virginia Division of Emergency Management (DEM) must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 2 CFR 200.332(b) requires that all pass-through entities must: (b) Evaluate each subrecipient’s risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring described in paragraphs (d) and (e) of this section, which may include consideration of such factors as: (1) The subrecipient’s prior experience with the same or similar subawards; (2) The results of previous audits including whether or not the subrecipient receives a Single Audit in accordance with Subpart F of this part, and the extent to which the same or similar subaward has been audited as a major program; (3) Whether the subrecipient has new personnel or new or substantially changed systems; and (4) The extent and results of Federal awarding agency monitoring (e.g., if the subrecipient also receives Federal awards directly from a Federal awarding agency). 2 CFR 200.332(f) required that all pass-through entities must “verify that every subrecipient is audited as required by Subpart F of this part when it is expected that the subrecipient’s Federal awards expended during the respective fiscal year equaled or exceeded the threshold set forth in Section 200.501.” Condition: The School Building Authority (SBA) did not perform subrecipient risk assessments. Additionally, SBA did not verify if subrecipients subject to be audited per 2 CFR 200.332(f) were audited as required. Cause: SBA does not have proper policies and procedures in place surrounding the subrecipient monitoring compliance requirements. Effect or Potential Effect: SBA is not in compliance with the subrecipient monitoring compliance requirements. Questioned Costs: Unknown Context: Total federal expenditures for the Disaster Grants – Public Assistance (Presidentially Declared Disasters) program were $123,949,127 for the year ended June 30, 2023. SBA had two subrecipients with subrecipient expenditures totaling $45,615,370 for the year ended June 30, 2023. Identification as a Repeat Finding: Prior Year Finding 2022–043 Recommendation: We recommend that SBA implement policies and procedures surrounding subrecipient monitoring to ensure they are in compliance with the subrecipient monitoring compliance requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2023–056 INTERNAL CONTROLS OVER ACTIVITIES ALLOWED OR UNALLOWED AND ALLOWABLE COSTS/COST PRINCIPLES Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Homeland Security Disaster Grants – Public Assistance (Presidentially Declared Disasters) 97.036/COVID-19 97.036, Grant Award FEMA–4273-DR–WV, Grant Award FEMA–4331-DR–WV, Grant Award FEMA–4359-DR–WV, Grant Award FEMA–4378-DR–WV, Grant Award FEMA–4455-DR–WV, Grant Award FEMA–4517-DR–WV, Grant Award FEMA–4603-DR–WV, Grant Award FEMA–4605-DR–WV Criteria or specific requirement (including statutory, regulatory or other citation): 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: For 21 of the 40 payroll transactions selected for testing at the West Virginia Military Authority (the Authority), there was no documentation that the employee’s time worked was reviewed and approved. Cause: The Authority does not have adequate internal controls and policies and procedures in place to ensure all payroll transactions are reviewed and approved. Effect or Potential Effect: The Authority may not identify noncompliance with federal statues, regulations, and terms of the conditions of the federal award including allowability. Expenditures may be paid that are not allowable. Questioned Costs: N/A Context: Total federal expenditures for the Disaster Grants – Public Assistance (Presidentially Declared Disasters) program were $123,949,127, for the year ended June 30, 2023. Total payroll charged to the grant at the Authority was $2,221,140. Identification as a Repeat Finding: This is not a repeat finding from the prior year. Recommendation: We recommend that the Authority implement controls to ensure that expenditures are properly reviewed and approved before being charged to a federal award. Views of Responsible Officials: Management acknowledges the finding. See corrective action plan.
2023–057 ACTIVITIES ALLOWED OR UNALLOWED AND ALLOWABLE COSTS/COST PRINCIPLES Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Homeland Security Disaster Grants – Public Assistance (Presidentially Declared Disasters) 97.036/COVID-19 97.036, Grant Award FEMA–4273-DR–WV, Grant Award FEMA–4331-DR–WV, Grant Award FEMA–4359-DR–WV, Grant Award FEMA–4378-DR–WV, Grant Award FEMA–4455-DR–WV, Grant Award FEMA–4517-DR–WV, Grant Award FEMA–4603-DR–WV, Grant Award FEMA–4605-DR–WV Criteria or specific requirement (including statutory, regulatory or other citation): 2 CFR 200.303 requires that the West Virginia Division of Emergency Management (DEM) must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 2 CFR 200.403 requires that costs “be necessary and reasonable for the performance of the Federal award.” Costs should not consist of improper payments, including payments that were made to an ineligible party or for an ineligible good or service or payments for goods or services not received. Condition: The West Virginia Department of Health and Human Resources (DHHR) paid invoices to a third party vendor that were approved for payment without verifying the invoices for accuracy. Cause: DHHR does not have proper internal controls in place to ensure that invoices are verified for accuracy prior to payment. Effect or Potential Effect: Unallowable expenditures may have been paid with federal funds. Questioned Costs: $3,464,213 Context: Total federal expenditures for the Disaster Grants – Public Assistance (Presidentially Declared Disasters) program were $123,949,127 for the year ended June 30, 2023. Identification as a Repeat Finding: This is not a repeat finding from the prior year. Recommendation: We recommend that DHHR implement proper internal controls to ensure that all invoices are accurate. and costs are allowable under the federal program. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
Federal Program: 21.027 Coronavirus State and Local Fiscal Recovery Funds Award Number and Year: 2023 Name of Federal Agency: U.S. Department of the Treasury Compliance Requirements Allowable Costs/Cost Principles Type of Finding: Material Weakness Amount of Questioned Costs: $0 COVID Related: Yes This is a repeat finding and was included in the prior year report as finding 2022-004. The Henderson County Fiscal Court transferred federal funds from the ARPA Fund to the Road Fund without first ensuring sufficient supporting documentation of allowable expenditures prior to the transfer. The county was awarded $8,781,513 in American Rescue Plan Act (ARPA) funds, receiving the first payment of $4,390,756 into the ARPA Fund in June 2021 and a second payment of $4,390,757 in June 2022. In August 2022, the county transferred $1,589,900 from the ARPA Fund into the Road Fund for “lost revenue”. At the time of the transfer, the county did not maintain a list of expenditures that reconciled to the transfer total. After the disbursements were expended, the county gathered documentation and provided auditors a reconciliation of expenditures of eligible costs that supported the amount transferred into the road fund. An effective internal control system was not in place in Henderson County to ensure compliance with requirements related to the administration of ARPA funds and the Allowable Costs/Cost Principles compliance requirements. Failure to establish and maintain effective internal controls over compliance with federal program requirements could subject the county to the risk of reporting ineligible expenditures on the SEFA and using grant funds for unallowable purposes. 2 CFR 200.303 states in part: “The non-Federal entity must: (a) Establish and maintain effective internal controls over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.” We recommend the county establish and maintain internal controls over compliance for all federal program expenditures to ensure accurate use and reporting of federal awards, including maintaining sufficient supporting documentation of expenditures that reconciles to any transfer from a federal program fund into other county funds at the time of the transfer.
Finding No.: 2023 001 – Enrollment Reporting Federal Agency: U.S. Department of Education Pass through Agency: Direct Program Name: Student Financial Assistance Cluster – Federal Direct Loan Program, Federal Pell Grant Program CFDA Numbers: 84.268, 84.063 Federal Award Year: July 1, 2022 – June 30, 2023 Criteria Institutions are required to report enrollment information under the Pell grant, Direct Loan, and Federal Family Education Loan (FFEL) programs via the National Student Loan Data System (NSLDS) (OMB No. 1845 0035) (Pell, 34 CFR 690.83(b)(2); Direct Loan, 34 CFR 685.309). The administration of the Title IV programs depends heavily on the accuracy and timeliness of the enrollment reported by institutions. Institutions must review, update, and verify student enrollment statuses, program information, and effective dates that appear on the Enrollment Reporting Roster file or on the Enrollment Maintenance page of the NSLDS Professional Access (NSLDSFAP) website. The Department of Education lists several certification methods for enrollment reporting, including certifying directly through the NSLDS web site, certifying through the NSLDS’s batch enrollment reporting process, or through certification of rosters provided to the National Student Clearinghouse (NSC). Per 2 CFR 200.303, a non federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non federal entity is managing the federal award in compliance with federal statutes, regulations, and terms and conditions of the federal award. Condition Found The University generally certifies its enrollment information through rosters provided to the NSC. Of the 60 students with enrollment changes that we selected for test work, we identified 60 students whose changes in enrollment status were not timely transmitted to NSLDS, as follows: • For fifty five (55) students, the University was notified of each student’s enrollment status change from full time to graduated in May 2023. Accordingly, the students’ status changes should have been transmitted within 60 days of degree conferral. However, submission was not timely, as the final submission of change of status ranged from seven (7) days to eleven (11) days after the required submission date. • For five (5) students, the University was notified of each student’s enrollment status change as withdrawn in May or June 2023. Accordingly, the students’ status changes should have been transmitted after notification of transfer within the appropriate timeframe. However, submission was not timely, as the final submission of change of status ranged from thirty seven (37) days to seventy seven (77) days after the required submission date. Cause For the aforementioned (55) students, the change in enrollment status was not entered timely due to issues with accessing the NSC FTP site and the fact that resources were not available to submit the data timely after these issues were encountered. For the aforementioned five (5) transfer students, the University’s internal control processes did not operate consistently to ensure that all enrollment information, including transfers effective at the end of the semester, were submitted timely to NSLDS. Possible Asserted Effect Untimely submission of student enrollment status information affects the determinations that lenders and servicers of students’ loans make related to in school status, deferments, grace periods, and repayment schedules, as well as the federal government’s payment of interest subsidies. Questioned Costs No questioned costs were identified. Statistical Sampling The sample was not intended to be, and was not, a statistically valid sample. Repeat Finding While not a repeat finding, a finding principally related to the accuracy of enrollment reporting was reported as finding 2021 001 in the University’s fiscal 2021 Uniform Guidance report. Recommendation We recommend the University update FTP users and include verification of FTP account users’ access with NSC on a periodic basis and implement a back up procedure to transmit data using another mechanism (i.e., Direct to NSLDS) in the event of technology issues. We also recommend that the University review and revise its processes and internal controls to ensure that all enrollment information and status changes, including those effective at the end of a semester, are reported in a timely manner. Views of Responsible Officials The University places significant importance on the accurate and timely reporting of enrollment status changes, recognizing its crucial role in facilitating lenders and servicers of student loans to determine in school status, deferments, grace periods, and repayment schedules. Additionally, it plays a pivotal role in ensuring the federal government’s payment of interest subsidies. The delay in reporting the graduation status of 55 students was, in part, due to the University’s inability to timely access NSC, the platform utilized to report enrollment changes to the NSLDS. In June 2023, NSC reported the MOVEit data breach, necessitating the University to reset its password to NSC. This complicated the process of timely submission. To address and prevent such issues in the future, the University has implemented enhanced controls. These measures include clearly defined procedures for contact management in enrollment reporting, outlining processes for removing or adding contacts. Additionally, the University commits to conducting an annual, or as personnel changes within the University necessitate, confirmation with NSC to ensure the accuracy and currency of contact information, thereby averting potential delays in the future. The delay in reporting the additional five students was due to the design of the University’s summer withdrawal reporting process. The five students communicated their intent to leave during the summer but were not included in the typical summer enrollment file for reporting withdrawals during the term. Rather, they were included in the first fall file that was processed. To prevent such delays, the University has revised its enrollment reporting process. Summer withdrawals will now be reported directly to NSC at the time of withdrawal, ensuring timely and accurate reporting. The Registrar’s Office will submit a manual enrollment status change to NSC. This proactive approach also enhances efficiency in reporting summer withdrawals.
Finding No.: 2023 001 – Enrollment Reporting Federal Agency: U.S. Department of Education Pass through Agency: Direct Program Name: Student Financial Assistance Cluster – Federal Direct Loan Program, Federal Pell Grant Program CFDA Numbers: 84.268, 84.063 Federal Award Year: July 1, 2022 – June 30, 2023 Criteria Institutions are required to report enrollment information under the Pell grant, Direct Loan, and Federal Family Education Loan (FFEL) programs via the National Student Loan Data System (NSLDS) (OMB No. 1845 0035) (Pell, 34 CFR 690.83(b)(2); Direct Loan, 34 CFR 685.309). The administration of the Title IV programs depends heavily on the accuracy and timeliness of the enrollment reported by institutions. Institutions must review, update, and verify student enrollment statuses, program information, and effective dates that appear on the Enrollment Reporting Roster file or on the Enrollment Maintenance page of the NSLDS Professional Access (NSLDSFAP) website. The Department of Education lists several certification methods for enrollment reporting, including certifying directly through the NSLDS web site, certifying through the NSLDS’s batch enrollment reporting process, or through certification of rosters provided to the National Student Clearinghouse (NSC). Per 2 CFR 200.303, a non federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non federal entity is managing the federal award in compliance with federal statutes, regulations, and terms and conditions of the federal award. Condition Found The University generally certifies its enrollment information through rosters provided to the NSC. Of the 60 students with enrollment changes that we selected for test work, we identified 60 students whose changes in enrollment status were not timely transmitted to NSLDS, as follows: • For fifty five (55) students, the University was notified of each student’s enrollment status change from full time to graduated in May 2023. Accordingly, the students’ status changes should have been transmitted within 60 days of degree conferral. However, submission was not timely, as the final submission of change of status ranged from seven (7) days to eleven (11) days after the required submission date. • For five (5) students, the University was notified of each student’s enrollment status change as withdrawn in May or June 2023. Accordingly, the students’ status changes should have been transmitted after notification of transfer within the appropriate timeframe. However, submission was not timely, as the final submission of change of status ranged from thirty seven (37) days to seventy seven (77) days after the required submission date. Cause For the aforementioned (55) students, the change in enrollment status was not entered timely due to issues with accessing the NSC FTP site and the fact that resources were not available to submit the data timely after these issues were encountered. For the aforementioned five (5) transfer students, the University’s internal control processes did not operate consistently to ensure that all enrollment information, including transfers effective at the end of the semester, were submitted timely to NSLDS. Possible Asserted Effect Untimely submission of student enrollment status information affects the determinations that lenders and servicers of students’ loans make related to in school status, deferments, grace periods, and repayment schedules, as well as the federal government’s payment of interest subsidies. Questioned Costs No questioned costs were identified. Statistical Sampling The sample was not intended to be, and was not, a statistically valid sample. Repeat Finding While not a repeat finding, a finding principally related to the accuracy of enrollment reporting was reported as finding 2021 001 in the University’s fiscal 2021 Uniform Guidance report. Recommendation We recommend the University update FTP users and include verification of FTP account users’ access with NSC on a periodic basis and implement a back up procedure to transmit data using another mechanism (i.e., Direct to NSLDS) in the event of technology issues. We also recommend that the University review and revise its processes and internal controls to ensure that all enrollment information and status changes, including those effective at the end of a semester, are reported in a timely manner. Views of Responsible Officials The University places significant importance on the accurate and timely reporting of enrollment status changes, recognizing its crucial role in facilitating lenders and servicers of student loans to determine in school status, deferments, grace periods, and repayment schedules. Additionally, it plays a pivotal role in ensuring the federal government’s payment of interest subsidies. The delay in reporting the graduation status of 55 students was, in part, due to the University’s inability to timely access NSC, the platform utilized to report enrollment changes to the NSLDS. In June 2023, NSC reported the MOVEit data breach, necessitating the University to reset its password to NSC. This complicated the process of timely submission. To address and prevent such issues in the future, the University has implemented enhanced controls. These measures include clearly defined procedures for contact management in enrollment reporting, outlining processes for removing or adding contacts. Additionally, the University commits to conducting an annual, or as personnel changes within the University necessitate, confirmation with NSC to ensure the accuracy and currency of contact information, thereby averting potential delays in the future. The delay in reporting the additional five students was due to the design of the University’s summer withdrawal reporting process. The five students communicated their intent to leave during the summer but were not included in the typical summer enrollment file for reporting withdrawals during the term. Rather, they were included in the first fall file that was processed. To prevent such delays, the University has revised its enrollment reporting process. Summer withdrawals will now be reported directly to NSC at the time of withdrawal, ensuring timely and accurate reporting. The Registrar’s Office will submit a manual enrollment status change to NSC. This proactive approach also enhances efficiency in reporting summer withdrawals.
Internal control deficiency and noncompliance over Equipment and Real Property Management related to the physical inventory of property. Identification of the federal program: Research and Development Cluster See the Schedule of Findings and Questioned Costs for table. Criteria or specific requirement (including statutory, regulatory or other citation): Title 2, Subtitle A, Chapter II, Part 200, Subpart D, 200.303 – Internal controls. The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Title 2, Subtitle A, Chapter II, Part 200, Subpart D, Property Standards, 200.313(d)(2) – Equipment. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years. Condition: During our testing over equipment and real property management, we observed management did not have effective internal controls in place to ensure a physical inventory of the property which must be taken and the results reconciled with property records was completed at least once every two years. Cause: Management did not have effective internal controls in place over the compliance requirement as stated in the criteria or specific requirement section above. Effect or potential effect: A physical inventory of the property which must be taken and the results reconciled with property records was not completed at least once every two years. This could potentially result in the property records not reconciling with the actual property present at the entity’s facilities. Questioned costs: None. Context: During our testing over equipment and real property management, we obtained a listing of property that had a net book value of $2,377,270. We observed management did not perform a physical inventory of this property. Identification as a repeat finding, if applicable: No. Recommendation: We recommend management develop and implement effective internal controls to ensure a physical inventory of property which must be taken and the results reconciled with property records is completed at least once every two years. Views of responsible officials: In response to this finding management will implement the following: An education session occurred on February 7, 2024, with the relevant parties across the Cedars-Sinai Research Facilities department. The session focused on the uniform guidance, more specifically the requirements to perform a physical inventory of property at least once every two years as set forth in CFR 200.313 (d) (2). We will schedule follow up sessions in March 2024 (first session scheduled for March 1st, second session TBD) to review and update existing policies and procedures to ensure future transfer of knowledge, as well as finalize a plan of action in order to complete a physical inventory of research equipment by the end of the fiscal year period, June 2024.
Internal control deficiency and noncompliance over Equipment and Real Property Management related to the physical inventory of property. Identification of the federal program: Research and Development Cluster See the Schedule of Findings and Questioned Costs for table. Criteria or specific requirement (including statutory, regulatory or other citation): Title 2, Subtitle A, Chapter II, Part 200, Subpart D, 200.303 – Internal controls. The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Title 2, Subtitle A, Chapter II, Part 200, Subpart D, Property Standards, 200.313(d)(2) – Equipment. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years. Condition: During our testing over equipment and real property management, we observed management did not have effective internal controls in place to ensure a physical inventory of the property which must be taken and the results reconciled with property records was completed at least once every two years. Cause: Management did not have effective internal controls in place over the compliance requirement as stated in the criteria or specific requirement section above. Effect or potential effect: A physical inventory of the property which must be taken and the results reconciled with property records was not completed at least once every two years. This could potentially result in the property records not reconciling with the actual property present at the entity’s facilities. Questioned costs: None. Context: During our testing over equipment and real property management, we obtained a listing of property that had a net book value of $2,377,270. We observed management did not perform a physical inventory of this property. Identification as a repeat finding, if applicable: No. Recommendation: We recommend management develop and implement effective internal controls to ensure a physical inventory of property which must be taken and the results reconciled with property records is completed at least once every two years. Views of responsible officials: In response to this finding management will implement the following: An education session occurred on February 7, 2024, with the relevant parties across the Cedars-Sinai Research Facilities department. The session focused on the uniform guidance, more specifically the requirements to perform a physical inventory of property at least once every two years as set forth in CFR 200.313 (d) (2). We will schedule follow up sessions in March 2024 (first session scheduled for March 1st, second session TBD) to review and update existing policies and procedures to ensure future transfer of knowledge, as well as finalize a plan of action in order to complete a physical inventory of research equipment by the end of the fiscal year period, June 2024.
Internal control deficiency and noncompliance over Equipment and Real Property Management related to the physical inventory of property. Identification of the federal program: Research and Development Cluster See the Schedule of Findings and Questioned Costs for table. Criteria or specific requirement (including statutory, regulatory or other citation): Title 2, Subtitle A, Chapter II, Part 200, Subpart D, 200.303 – Internal controls. The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Title 2, Subtitle A, Chapter II, Part 200, Subpart D, Property Standards, 200.313(d)(2) – Equipment. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years. Condition: During our testing over equipment and real property management, we observed management did not have effective internal controls in place to ensure a physical inventory of the property which must be taken and the results reconciled with property records was completed at least once every two years. Cause: Management did not have effective internal controls in place over the compliance requirement as stated in the criteria or specific requirement section above. Effect or potential effect: A physical inventory of the property which must be taken and the results reconciled with property records was not completed at least once every two years. This could potentially result in the property records not reconciling with the actual property present at the entity’s facilities. Questioned costs: None. Context: During our testing over equipment and real property management, we obtained a listing of property that had a net book value of $2,377,270. We observed management did not perform a physical inventory of this property. Identification as a repeat finding, if applicable: No. Recommendation: We recommend management develop and implement effective internal controls to ensure a physical inventory of property which must be taken and the results reconciled with property records is completed at least once every two years. Views of responsible officials: In response to this finding management will implement the following: An education session occurred on February 7, 2024, with the relevant parties across the Cedars-Sinai Research Facilities department. The session focused on the uniform guidance, more specifically the requirements to perform a physical inventory of property at least once every two years as set forth in CFR 200.313 (d) (2). We will schedule follow up sessions in March 2024 (first session scheduled for March 1st, second session TBD) to review and update existing policies and procedures to ensure future transfer of knowledge, as well as finalize a plan of action in order to complete a physical inventory of research equipment by the end of the fiscal year period, June 2024.
Internal control deficiency and noncompliance over Equipment and Real Property Management related to the physical inventory of property. Identification of the federal program: Research and Development Cluster See the Schedule of Findings and Questioned Costs for table. Criteria or specific requirement (including statutory, regulatory or other citation): Title 2, Subtitle A, Chapter II, Part 200, Subpart D, 200.303 – Internal controls. The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Title 2, Subtitle A, Chapter II, Part 200, Subpart D, Property Standards, 200.313(d)(2) – Equipment. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years. Condition: During our testing over equipment and real property management, we observed management did not have effective internal controls in place to ensure a physical inventory of the property which must be taken and the results reconciled with property records was completed at least once every two years. Cause: Management did not have effective internal controls in place over the compliance requirement as stated in the criteria or specific requirement section above. Effect or potential effect: A physical inventory of the property which must be taken and the results reconciled with property records was not completed at least once every two years. This could potentially result in the property records not reconciling with the actual property present at the entity’s facilities. Questioned costs: None. Context: During our testing over equipment and real property management, we obtained a listing of property that had a net book value of $2,377,270. We observed management did not perform a physical inventory of this property. Identification as a repeat finding, if applicable: No. Recommendation: We recommend management develop and implement effective internal controls to ensure a physical inventory of property which must be taken and the results reconciled with property records is completed at least once every two years. Views of responsible officials: In response to this finding management will implement the following: An education session occurred on February 7, 2024, with the relevant parties across the Cedars-Sinai Research Facilities department. The session focused on the uniform guidance, more specifically the requirements to perform a physical inventory of property at least once every two years as set forth in CFR 200.313 (d) (2). We will schedule follow up sessions in March 2024 (first session scheduled for March 1st, second session TBD) to review and update existing policies and procedures to ensure future transfer of knowledge, as well as finalize a plan of action in order to complete a physical inventory of research equipment by the end of the fiscal year period, June 2024.
Internal control deficiency and noncompliance over Equipment and Real Property Management related to the physical inventory of property. Identification of the federal program: Research and Development Cluster See the Schedule of Findings and Questioned Costs for table. Criteria or specific requirement (including statutory, regulatory or other citation): Title 2, Subtitle A, Chapter II, Part 200, Subpart D, 200.303 – Internal controls. The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Title 2, Subtitle A, Chapter II, Part 200, Subpart D, Property Standards, 200.313(d)(2) – Equipment. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years. Condition: During our testing over equipment and real property management, we observed management did not have effective internal controls in place to ensure a physical inventory of the property which must be taken and the results reconciled with property records was completed at least once every two years. Cause: Management did not have effective internal controls in place over the compliance requirement as stated in the criteria or specific requirement section above. Effect or potential effect: A physical inventory of the property which must be taken and the results reconciled with property records was not completed at least once every two years. This could potentially result in the property records not reconciling with the actual property present at the entity’s facilities. Questioned costs: None. Context: During our testing over equipment and real property management, we obtained a listing of property that had a net book value of $2,377,270. We observed management did not perform a physical inventory of this property. Identification as a repeat finding, if applicable: No. Recommendation: We recommend management develop and implement effective internal controls to ensure a physical inventory of property which must be taken and the results reconciled with property records is completed at least once every two years. Views of responsible officials: In response to this finding management will implement the following: An education session occurred on February 7, 2024, with the relevant parties across the Cedars-Sinai Research Facilities department. The session focused on the uniform guidance, more specifically the requirements to perform a physical inventory of property at least once every two years as set forth in CFR 200.313 (d) (2). We will schedule follow up sessions in March 2024 (first session scheduled for March 1st, second session TBD) to review and update existing policies and procedures to ensure future transfer of knowledge, as well as finalize a plan of action in order to complete a physical inventory of research equipment by the end of the fiscal year period, June 2024.
Internal control deficiency and noncompliance over Equipment and Real Property Management related to the physical inventory of property. Identification of the federal program: Research and Development Cluster See the Schedule of Findings and Questioned Costs for table. Criteria or specific requirement (including statutory, regulatory or other citation): Title 2, Subtitle A, Chapter II, Part 200, Subpart D, 200.303 – Internal controls. The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Title 2, Subtitle A, Chapter II, Part 200, Subpart D, Property Standards, 200.313(d)(2) – Equipment. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years. Condition: During our testing over equipment and real property management, we observed management did not have effective internal controls in place to ensure a physical inventory of the property which must be taken and the results reconciled with property records was completed at least once every two years. Cause: Management did not have effective internal controls in place over the compliance requirement as stated in the criteria or specific requirement section above. Effect or potential effect: A physical inventory of the property which must be taken and the results reconciled with property records was not completed at least once every two years. This could potentially result in the property records not reconciling with the actual property present at the entity’s facilities. Questioned costs: None. Context: During our testing over equipment and real property management, we obtained a listing of property that had a net book value of $2,377,270. We observed management did not perform a physical inventory of this property. Identification as a repeat finding, if applicable: No. Recommendation: We recommend management develop and implement effective internal controls to ensure a physical inventory of property which must be taken and the results reconciled with property records is completed at least once every two years. Views of responsible officials: In response to this finding management will implement the following: An education session occurred on February 7, 2024, with the relevant parties across the Cedars-Sinai Research Facilities department. The session focused on the uniform guidance, more specifically the requirements to perform a physical inventory of property at least once every two years as set forth in CFR 200.313 (d) (2). We will schedule follow up sessions in March 2024 (first session scheduled for March 1st, second session TBD) to review and update existing policies and procedures to ensure future transfer of knowledge, as well as finalize a plan of action in order to complete a physical inventory of research equipment by the end of the fiscal year period, June 2024.
Internal control deficiency and noncompliance over Equipment and Real Property Management related to the physical inventory of property. Identification of the federal program: Research and Development Cluster See the Schedule of Findings and Questioned Costs for table. Criteria or specific requirement (including statutory, regulatory or other citation): Title 2, Subtitle A, Chapter II, Part 200, Subpart D, 200.303 – Internal controls. The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Title 2, Subtitle A, Chapter II, Part 200, Subpart D, Property Standards, 200.313(d)(2) – Equipment. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years. Condition: During our testing over equipment and real property management, we observed management did not have effective internal controls in place to ensure a physical inventory of the property which must be taken and the results reconciled with property records was completed at least once every two years. Cause: Management did not have effective internal controls in place over the compliance requirement as stated in the criteria or specific requirement section above. Effect or potential effect: A physical inventory of the property which must be taken and the results reconciled with property records was not completed at least once every two years. This could potentially result in the property records not reconciling with the actual property present at the entity’s facilities. Questioned costs: None. Context: During our testing over equipment and real property management, we obtained a listing of property that had a net book value of $2,377,270. We observed management did not perform a physical inventory of this property. Identification as a repeat finding, if applicable: No. Recommendation: We recommend management develop and implement effective internal controls to ensure a physical inventory of property which must be taken and the results reconciled with property records is completed at least once every two years. Views of responsible officials: In response to this finding management will implement the following: An education session occurred on February 7, 2024, with the relevant parties across the Cedars-Sinai Research Facilities department. The session focused on the uniform guidance, more specifically the requirements to perform a physical inventory of property at least once every two years as set forth in CFR 200.313 (d) (2). We will schedule follow up sessions in March 2024 (first session scheduled for March 1st, second session TBD) to review and update existing policies and procedures to ensure future transfer of knowledge, as well as finalize a plan of action in order to complete a physical inventory of research equipment by the end of the fiscal year period, June 2024.
Internal control deficiency and noncompliance over Equipment and Real Property Management related to the physical inventory of property. Identification of the federal program: Research and Development Cluster See the Schedule of Findings and Questioned Costs for table. Criteria or specific requirement (including statutory, regulatory or other citation): Title 2, Subtitle A, Chapter II, Part 200, Subpart D, 200.303 – Internal controls. The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Title 2, Subtitle A, Chapter II, Part 200, Subpart D, Property Standards, 200.313(d)(2) – Equipment. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years. Condition: During our testing over equipment and real property management, we observed management did not have effective internal controls in place to ensure a physical inventory of the property which must be taken and the results reconciled with property records was completed at least once every two years. Cause: Management did not have effective internal controls in place over the compliance requirement as stated in the criteria or specific requirement section above. Effect or potential effect: A physical inventory of the property which must be taken and the results reconciled with property records was not completed at least once every two years. This could potentially result in the property records not reconciling with the actual property present at the entity’s facilities. Questioned costs: None. Context: During our testing over equipment and real property management, we obtained a listing of property that had a net book value of $2,377,270. We observed management did not perform a physical inventory of this property. Identification as a repeat finding, if applicable: No. Recommendation: We recommend management develop and implement effective internal controls to ensure a physical inventory of property which must be taken and the results reconciled with property records is completed at least once every two years. Views of responsible officials: In response to this finding management will implement the following: An education session occurred on February 7, 2024, with the relevant parties across the Cedars-Sinai Research Facilities department. The session focused on the uniform guidance, more specifically the requirements to perform a physical inventory of property at least once every two years as set forth in CFR 200.313 (d) (2). We will schedule follow up sessions in March 2024 (first session scheduled for March 1st, second session TBD) to review and update existing policies and procedures to ensure future transfer of knowledge, as well as finalize a plan of action in order to complete a physical inventory of research equipment by the end of the fiscal year period, June 2024.
Internal control deficiency and noncompliance over Activities Allowed or Unallowed, Allowable Costs/Cost Principles, and Reporting related to expenses attributable to coronavirus reported in the provider relief fund reports. Identification of the federal program: Assistance Listing Number 93.498 • COVID-19 – Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution • U.S. Department of Health and Human Services • Federal award identification number – Not Applicable • Federal award year: – Period 4 – January 1, 2020 to December 31, 2022 – Period 5 – January 1, 2020 to June 30, 2023 Criteria or specific requirement (including statutory, regulatory or other citation): Title 2, Subtitle A, Chapter II, Part 200, Subpart D, 200.303 – Internal controls. The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The terms and conditions of the award requires the following: • The recipient certifies that the payment will only be used to prevent, prepare for, and respond to coronavirus, and that the payment shall reimburse the recipient only for health care related expenses or lost revenues that are attributable to coronavirus. The burden of proof is on the recipient to maintain documentation that shows how expenses prevent, prepare for, and respond to coronavirus. • The recipient certifies that it will not use the payment to reimburse expenses or losses that have been reimbursed from other sources or that other sources are obligated to reimburse. • The recipient shall adhere to the reporting requirements on provider relief fund payments for payments received exceeding $10,000 in the aggregate during the payment received period. The recipient must register in the provider relief fund reporting portal and submit reports as specified by Health and Human Services. • The recipient certifies that all information it provides as part of any application for the payment, as well as all information and reports relating to the payment that it provides in the future at the request of Health and Human Services or the Health and Human Services inspector general, are true, accurate and complete, to the best of its knowledge. • The recipient shall maintain appropriate records and cost documentation including, as applicable, documentation described in 45 CFR 75.302 – financial management and 45 CFR 75.361 through 75.365 – record retention and access, and other information required by the future program instructions to substantiate the reimbursement of costs under this award. Condition: During our testing over healthcare related expenses included in the provider relief fund reports, we observed management did not have effective internal controls in place to ensure expenses complied with the terms and conditions of the award. This resulted in an overstatement of expenses included in the provider relief fund reports. Cause: Management did not have effective internal controls in place over the compliance requirement as stated in the criteria or specific requirement section above. Effective or potential effect: Expenses submitted in the provider relief fund report were not supported by adequate documentation to substantiate that these funds were used for health care-related expenses attributable to coronavirus. Questioned costs: $952,828 – Assistance Listing Number 93.498. See corresponding award identification number in the identification of federal award section above. Questioned costs were computed by taking the total expenses not supported by adequate documentation at Huntington Ambulatory Surgery Center LLC of $948,707 and Torrance Memorial Medical Center of $4,121 for a total of $952,828. Context: During our testing over health care-related expenses attributable to coronavirus at Huntington Ambulatory Surgery Center LLC, we observed management submitted $948,707 in expenses that were not supported by adequate documentation to substantiate that these funds were used for health care-related expenses attributable to coronavirus. The burden of proof is on the recipient to maintain documentation that shows how expenses prevent, prepare for, and respond to coronavirus. During our testing over health care-related expenses attributable to coronavirus at Torrance Memorial Medical Center, we observed management submitted duplicated expenses which were reimbursed in the prior period in the amount of $4,121. During our testing over health care-related expenses attributable to coronavirus at Huntington Medical Foundation, we observed management did not have evidence of internal controls regarding the review and approval of the expenses used to substantiate the payments received in the provider relief fund report. Total expenses in the provider relief fund report was $1,062,349. Identification as a repeat finding, if applicable: No. Recommendation: We recommend management develop and implement effective internal controls to ensure expenses comply with the terms and conditions of the award. This will ensure expenses submitted in the provider relief fund reports are supported by adequate documentation to substantiate that these funds are used for health care-related expenses attributable to coronavirus. Views of responsible officials: The entity has excess lost revenues to cover all payments received (excluding the expenses submitted). Therefore, no refund is required for any payments received. Since the program has ended, the management has implemented the following procedures for future grants: 1) An education session occurred on February 15, 2024, with the relevant parties across Huntington Health entities to formally implement a review process whereby the Controller will review the support files prior to filings being made related to grant applications/programs across any of Huntington’s entities. Documentation of this review will be retained in the central file repository. These steps and controls will be updated and documented in the departmental policy. 2) A central folder on the Huntington Hospital’s main accounting drive has been created. This folder will be populated with all support for filed figures related to grant applications/programs across the hospital’s various entities. The support will be validated as having been placed into this folder as part of the reporting out process by the accounting manager and Controller handling the reporting. Files will be retained in this central drive for a minimum of 7 years. These steps and controls will be updated and documented in the departmental policy.
Internal control deficiency and noncompliance over Equipment and Real Property Management related to the physical inventory of property. Identification of the federal program: Research and Development Cluster See the Schedule of Findings and Questioned Costs for table. Criteria or specific requirement (including statutory, regulatory or other citation): Title 2, Subtitle A, Chapter II, Part 200, Subpart D, 200.303 – Internal controls. The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Title 2, Subtitle A, Chapter II, Part 200, Subpart D, Property Standards, 200.313(d)(2) – Equipment. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years. Condition: During our testing over equipment and real property management, we observed management did not have effective internal controls in place to ensure a physical inventory of the property which must be taken and the results reconciled with property records was completed at least once every two years. Cause: Management did not have effective internal controls in place over the compliance requirement as stated in the criteria or specific requirement section above. Effect or potential effect: A physical inventory of the property which must be taken and the results reconciled with property records was not completed at least once every two years. This could potentially result in the property records not reconciling with the actual property present at the entity’s facilities. Questioned costs: None. Context: During our testing over equipment and real property management, we obtained a listing of property that had a net book value of $2,377,270. We observed management did not perform a physical inventory of this property. Identification as a repeat finding, if applicable: No. Recommendation: We recommend management develop and implement effective internal controls to ensure a physical inventory of property which must be taken and the results reconciled with property records is completed at least once every two years. Views of responsible officials: In response to this finding management will implement the following: An education session occurred on February 7, 2024, with the relevant parties across the Cedars-Sinai Research Facilities department. The session focused on the uniform guidance, more specifically the requirements to perform a physical inventory of property at least once every two years as set forth in CFR 200.313 (d) (2). We will schedule follow up sessions in March 2024 (first session scheduled for March 1st, second session TBD) to review and update existing policies and procedures to ensure future transfer of knowledge, as well as finalize a plan of action in order to complete a physical inventory of research equipment by the end of the fiscal year period, June 2024.
Internal control deficiency and noncompliance over Equipment and Real Property Management related to the physical inventory of property. Identification of the federal program: Research and Development Cluster See the Schedule of Findings and Questioned Costs for table. Criteria or specific requirement (including statutory, regulatory or other citation): Title 2, Subtitle A, Chapter II, Part 200, Subpart D, 200.303 – Internal controls. The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Title 2, Subtitle A, Chapter II, Part 200, Subpart D, Property Standards, 200.313(d)(2) – Equipment. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years. Condition: During our testing over equipment and real property management, we observed management did not have effective internal controls in place to ensure a physical inventory of the property which must be taken and the results reconciled with property records was completed at least once every two years. Cause: Management did not have effective internal controls in place over the compliance requirement as stated in the criteria or specific requirement section above. Effect or potential effect: A physical inventory of the property which must be taken and the results reconciled with property records was not completed at least once every two years. This could potentially result in the property records not reconciling with the actual property present at the entity’s facilities. Questioned costs: None. Context: During our testing over equipment and real property management, we obtained a listing of property that had a net book value of $2,377,270. We observed management did not perform a physical inventory of this property. Identification as a repeat finding, if applicable: No. Recommendation: We recommend management develop and implement effective internal controls to ensure a physical inventory of property which must be taken and the results reconciled with property records is completed at least once every two years. Views of responsible officials: In response to this finding management will implement the following: An education session occurred on February 7, 2024, with the relevant parties across the Cedars-Sinai Research Facilities department. The session focused on the uniform guidance, more specifically the requirements to perform a physical inventory of property at least once every two years as set forth in CFR 200.313 (d) (2). We will schedule follow up sessions in March 2024 (first session scheduled for March 1st, second session TBD) to review and update existing policies and procedures to ensure future transfer of knowledge, as well as finalize a plan of action in order to complete a physical inventory of research equipment by the end of the fiscal year period, June 2024.
Internal control deficiency and noncompliance over Equipment and Real Property Management related to the physical inventory of property. Identification of the federal program: Research and Development Cluster See the Schedule of Findings and Questioned Costs for table. Criteria or specific requirement (including statutory, regulatory or other citation): Title 2, Subtitle A, Chapter II, Part 200, Subpart D, 200.303 – Internal controls. The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Title 2, Subtitle A, Chapter II, Part 200, Subpart D, Property Standards, 200.313(d)(2) – Equipment. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years. Condition: During our testing over equipment and real property management, we observed management did not have effective internal controls in place to ensure a physical inventory of the property which must be taken and the results reconciled with property records was completed at least once every two years. Cause: Management did not have effective internal controls in place over the compliance requirement as stated in the criteria or specific requirement section above. Effect or potential effect: A physical inventory of the property which must be taken and the results reconciled with property records was not completed at least once every two years. This could potentially result in the property records not reconciling with the actual property present at the entity’s facilities. Questioned costs: None. Context: During our testing over equipment and real property management, we obtained a listing of property that had a net book value of $2,377,270. We observed management did not perform a physical inventory of this property. Identification as a repeat finding, if applicable: No. Recommendation: We recommend management develop and implement effective internal controls to ensure a physical inventory of property which must be taken and the results reconciled with property records is completed at least once every two years. Views of responsible officials: In response to this finding management will implement the following: An education session occurred on February 7, 2024, with the relevant parties across the Cedars-Sinai Research Facilities department. The session focused on the uniform guidance, more specifically the requirements to perform a physical inventory of property at least once every two years as set forth in CFR 200.313 (d) (2). We will schedule follow up sessions in March 2024 (first session scheduled for March 1st, second session TBD) to review and update existing policies and procedures to ensure future transfer of knowledge, as well as finalize a plan of action in order to complete a physical inventory of research equipment by the end of the fiscal year period, June 2024.
Internal control deficiency and noncompliance over Equipment and Real Property Management related to the physical inventory of property. Identification of the federal program: Research and Development Cluster See the Schedule of Findings and Questioned Costs for table. Criteria or specific requirement (including statutory, regulatory or other citation): Title 2, Subtitle A, Chapter II, Part 200, Subpart D, 200.303 – Internal controls. The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Title 2, Subtitle A, Chapter II, Part 200, Subpart D, Property Standards, 200.313(d)(2) – Equipment. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years. Condition: During our testing over equipment and real property management, we observed management did not have effective internal controls in place to ensure a physical inventory of the property which must be taken and the results reconciled with property records was completed at least once every two years. Cause: Management did not have effective internal controls in place over the compliance requirement as stated in the criteria or specific requirement section above. Effect or potential effect: A physical inventory of the property which must be taken and the results reconciled with property records was not completed at least once every two years. This could potentially result in the property records not reconciling with the actual property present at the entity’s facilities. Questioned costs: None. Context: During our testing over equipment and real property management, we obtained a listing of property that had a net book value of $2,377,270. We observed management did not perform a physical inventory of this property. Identification as a repeat finding, if applicable: No. Recommendation: We recommend management develop and implement effective internal controls to ensure a physical inventory of property which must be taken and the results reconciled with property records is completed at least once every two years. Views of responsible officials: In response to this finding management will implement the following: An education session occurred on February 7, 2024, with the relevant parties across the Cedars-Sinai Research Facilities department. The session focused on the uniform guidance, more specifically the requirements to perform a physical inventory of property at least once every two years as set forth in CFR 200.313 (d) (2). We will schedule follow up sessions in March 2024 (first session scheduled for March 1st, second session TBD) to review and update existing policies and procedures to ensure future transfer of knowledge, as well as finalize a plan of action in order to complete a physical inventory of research equipment by the end of the fiscal year period, June 2024.
Internal control deficiency and noncompliance over Equipment and Real Property Management related to the physical inventory of property. Identification of the federal program: Research and Development Cluster See the Schedule of Findings and Questioned Costs for table. Criteria or specific requirement (including statutory, regulatory or other citation): Title 2, Subtitle A, Chapter II, Part 200, Subpart D, 200.303 – Internal controls. The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Title 2, Subtitle A, Chapter II, Part 200, Subpart D, Property Standards, 200.313(d)(2) – Equipment. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years. Condition: During our testing over equipment and real property management, we observed management did not have effective internal controls in place to ensure a physical inventory of the property which must be taken and the results reconciled with property records was completed at least once every two years. Cause: Management did not have effective internal controls in place over the compliance requirement as stated in the criteria or specific requirement section above. Effect or potential effect: A physical inventory of the property which must be taken and the results reconciled with property records was not completed at least once every two years. This could potentially result in the property records not reconciling with the actual property present at the entity’s facilities. Questioned costs: None. Context: During our testing over equipment and real property management, we obtained a listing of property that had a net book value of $2,377,270. We observed management did not perform a physical inventory of this property. Identification as a repeat finding, if applicable: No. Recommendation: We recommend management develop and implement effective internal controls to ensure a physical inventory of property which must be taken and the results reconciled with property records is completed at least once every two years. Views of responsible officials: In response to this finding management will implement the following: An education session occurred on February 7, 2024, with the relevant parties across the Cedars-Sinai Research Facilities department. The session focused on the uniform guidance, more specifically the requirements to perform a physical inventory of property at least once every two years as set forth in CFR 200.313 (d) (2). We will schedule follow up sessions in March 2024 (first session scheduled for March 1st, second session TBD) to review and update existing policies and procedures to ensure future transfer of knowledge, as well as finalize a plan of action in order to complete a physical inventory of research equipment by the end of the fiscal year period, June 2024.
Internal control deficiency and noncompliance over Equipment and Real Property Management related to the physical inventory of property. Identification of the federal program: Research and Development Cluster See the Schedule of Findings and Questioned Costs for table. Criteria or specific requirement (including statutory, regulatory or other citation): Title 2, Subtitle A, Chapter II, Part 200, Subpart D, 200.303 – Internal controls. The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Title 2, Subtitle A, Chapter II, Part 200, Subpart D, Property Standards, 200.313(d)(2) – Equipment. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years. Condition: During our testing over equipment and real property management, we observed management did not have effective internal controls in place to ensure a physical inventory of the property which must be taken and the results reconciled with property records was completed at least once every two years. Cause: Management did not have effective internal controls in place over the compliance requirement as stated in the criteria or specific requirement section above. Effect or potential effect: A physical inventory of the property which must be taken and the results reconciled with property records was not completed at least once every two years. This could potentially result in the property records not reconciling with the actual property present at the entity’s facilities. Questioned costs: None. Context: During our testing over equipment and real property management, we obtained a listing of property that had a net book value of $2,377,270. We observed management did not perform a physical inventory of this property. Identification as a repeat finding, if applicable: No. Recommendation: We recommend management develop and implement effective internal controls to ensure a physical inventory of property which must be taken and the results reconciled with property records is completed at least once every two years. Views of responsible officials: In response to this finding management will implement the following: An education session occurred on February 7, 2024, with the relevant parties across the Cedars-Sinai Research Facilities department. The session focused on the uniform guidance, more specifically the requirements to perform a physical inventory of property at least once every two years as set forth in CFR 200.313 (d) (2). We will schedule follow up sessions in March 2024 (first session scheduled for March 1st, second session TBD) to review and update existing policies and procedures to ensure future transfer of knowledge, as well as finalize a plan of action in order to complete a physical inventory of research equipment by the end of the fiscal year period, June 2024.
Internal control deficiency and noncompliance over Equipment and Real Property Management related to the physical inventory of property. Identification of the federal program: Research and Development Cluster See the Schedule of Findings and Questioned Costs for table. Criteria or specific requirement (including statutory, regulatory or other citation): Title 2, Subtitle A, Chapter II, Part 200, Subpart D, 200.303 – Internal controls. The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Title 2, Subtitle A, Chapter II, Part 200, Subpart D, Property Standards, 200.313(d)(2) – Equipment. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years. Condition: During our testing over equipment and real property management, we observed management did not have effective internal controls in place to ensure a physical inventory of the property which must be taken and the results reconciled with property records was completed at least once every two years. Cause: Management did not have effective internal controls in place over the compliance requirement as stated in the criteria or specific requirement section above. Effect or potential effect: A physical inventory of the property which must be taken and the results reconciled with property records was not completed at least once every two years. This could potentially result in the property records not reconciling with the actual property present at the entity’s facilities. Questioned costs: None. Context: During our testing over equipment and real property management, we obtained a listing of property that had a net book value of $2,377,270. We observed management did not perform a physical inventory of this property. Identification as a repeat finding, if applicable: No. Recommendation: We recommend management develop and implement effective internal controls to ensure a physical inventory of property which must be taken and the results reconciled with property records is completed at least once every two years. Views of responsible officials: In response to this finding management will implement the following: An education session occurred on February 7, 2024, with the relevant parties across the Cedars-Sinai Research Facilities department. The session focused on the uniform guidance, more specifically the requirements to perform a physical inventory of property at least once every two years as set forth in CFR 200.313 (d) (2). We will schedule follow up sessions in March 2024 (first session scheduled for March 1st, second session TBD) to review and update existing policies and procedures to ensure future transfer of knowledge, as well as finalize a plan of action in order to complete a physical inventory of research equipment by the end of the fiscal year period, June 2024.
Internal control deficiency and noncompliance over Equipment and Real Property Management related to the physical inventory of property. Identification of the federal program: Research and Development Cluster See the Schedule of Findings and Questioned Costs for table. Criteria or specific requirement (including statutory, regulatory or other citation): Title 2, Subtitle A, Chapter II, Part 200, Subpart D, 200.303 – Internal controls. The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Title 2, Subtitle A, Chapter II, Part 200, Subpart D, Property Standards, 200.313(d)(2) – Equipment. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years. Condition: During our testing over equipment and real property management, we observed management did not have effective internal controls in place to ensure a physical inventory of the property which must be taken and the results reconciled with property records was completed at least once every two years. Cause: Management did not have effective internal controls in place over the compliance requirement as stated in the criteria or specific requirement section above. Effect or potential effect: A physical inventory of the property which must be taken and the results reconciled with property records was not completed at least once every two years. This could potentially result in the property records not reconciling with the actual property present at the entity’s facilities. Questioned costs: None. Context: During our testing over equipment and real property management, we obtained a listing of property that had a net book value of $2,377,270. We observed management did not perform a physical inventory of this property. Identification as a repeat finding, if applicable: No. Recommendation: We recommend management develop and implement effective internal controls to ensure a physical inventory of property which must be taken and the results reconciled with property records is completed at least once every two years. Views of responsible officials: In response to this finding management will implement the following: An education session occurred on February 7, 2024, with the relevant parties across the Cedars-Sinai Research Facilities department. The session focused on the uniform guidance, more specifically the requirements to perform a physical inventory of property at least once every two years as set forth in CFR 200.313 (d) (2). We will schedule follow up sessions in March 2024 (first session scheduled for March 1st, second session TBD) to review and update existing policies and procedures to ensure future transfer of knowledge, as well as finalize a plan of action in order to complete a physical inventory of research equipment by the end of the fiscal year period, June 2024.
Internal control deficiency and noncompliance over Equipment and Real Property Management related to the physical inventory of property. Identification of the federal program: Research and Development Cluster See the Schedule of Findings and Questioned Costs for table. Criteria or specific requirement (including statutory, regulatory or other citation): Title 2, Subtitle A, Chapter II, Part 200, Subpart D, 200.303 – Internal controls. The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Title 2, Subtitle A, Chapter II, Part 200, Subpart D, Property Standards, 200.313(d)(2) – Equipment. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years. Condition: During our testing over equipment and real property management, we observed management did not have effective internal controls in place to ensure a physical inventory of the property which must be taken and the results reconciled with property records was completed at least once every two years. Cause: Management did not have effective internal controls in place over the compliance requirement as stated in the criteria or specific requirement section above. Effect or potential effect: A physical inventory of the property which must be taken and the results reconciled with property records was not completed at least once every two years. This could potentially result in the property records not reconciling with the actual property present at the entity’s facilities. Questioned costs: None. Context: During our testing over equipment and real property management, we obtained a listing of property that had a net book value of $2,377,270. We observed management did not perform a physical inventory of this property. Identification as a repeat finding, if applicable: No. Recommendation: We recommend management develop and implement effective internal controls to ensure a physical inventory of property which must be taken and the results reconciled with property records is completed at least once every two years. Views of responsible officials: In response to this finding management will implement the following: An education session occurred on February 7, 2024, with the relevant parties across the Cedars-Sinai Research Facilities department. The session focused on the uniform guidance, more specifically the requirements to perform a physical inventory of property at least once every two years as set forth in CFR 200.313 (d) (2). We will schedule follow up sessions in March 2024 (first session scheduled for March 1st, second session TBD) to review and update existing policies and procedures to ensure future transfer of knowledge, as well as finalize a plan of action in order to complete a physical inventory of research equipment by the end of the fiscal year period, June 2024.
Internal control deficiency and noncompliance over Equipment and Real Property Management related to the physical inventory of property. Identification of the federal program: Research and Development Cluster See the Schedule of Findings and Questioned Costs for table. Criteria or specific requirement (including statutory, regulatory or other citation): Title 2, Subtitle A, Chapter II, Part 200, Subpart D, 200.303 – Internal controls. The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Title 2, Subtitle A, Chapter II, Part 200, Subpart D, Property Standards, 200.313(d)(2) – Equipment. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years. Condition: During our testing over equipment and real property management, we observed management did not have effective internal controls in place to ensure a physical inventory of the property which must be taken and the results reconciled with property records was completed at least once every two years. Cause: Management did not have effective internal controls in place over the compliance requirement as stated in the criteria or specific requirement section above. Effect or potential effect: A physical inventory of the property which must be taken and the results reconciled with property records was not completed at least once every two years. This could potentially result in the property records not reconciling with the actual property present at the entity’s facilities. Questioned costs: None. Context: During our testing over equipment and real property management, we obtained a listing of property that had a net book value of $2,377,270. We observed management did not perform a physical inventory of this property. Identification as a repeat finding, if applicable: No. Recommendation: We recommend management develop and implement effective internal controls to ensure a physical inventory of property which must be taken and the results reconciled with property records is completed at least once every two years. Views of responsible officials: In response to this finding management will implement the following: An education session occurred on February 7, 2024, with the relevant parties across the Cedars-Sinai Research Facilities department. The session focused on the uniform guidance, more specifically the requirements to perform a physical inventory of property at least once every two years as set forth in CFR 200.313 (d) (2). We will schedule follow up sessions in March 2024 (first session scheduled for March 1st, second session TBD) to review and update existing policies and procedures to ensure future transfer of knowledge, as well as finalize a plan of action in order to complete a physical inventory of research equipment by the end of the fiscal year period, June 2024.
Internal control deficiency and noncompliance over Equipment and Real Property Management related to the physical inventory of property. Identification of the federal program: Research and Development Cluster See the Schedule of Findings and Questioned Costs for table. Criteria or specific requirement (including statutory, regulatory or other citation): Title 2, Subtitle A, Chapter II, Part 200, Subpart D, 200.303 – Internal controls. The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Title 2, Subtitle A, Chapter II, Part 200, Subpart D, Property Standards, 200.313(d)(2) – Equipment. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years. Condition: During our testing over equipment and real property management, we observed management did not have effective internal controls in place to ensure a physical inventory of the property which must be taken and the results reconciled with property records was completed at least once every two years. Cause: Management did not have effective internal controls in place over the compliance requirement as stated in the criteria or specific requirement section above. Effect or potential effect: A physical inventory of the property which must be taken and the results reconciled with property records was not completed at least once every two years. This could potentially result in the property records not reconciling with the actual property present at the entity’s facilities. Questioned costs: None. Context: During our testing over equipment and real property management, we obtained a listing of property that had a net book value of $2,377,270. We observed management did not perform a physical inventory of this property. Identification as a repeat finding, if applicable: No. Recommendation: We recommend management develop and implement effective internal controls to ensure a physical inventory of property which must be taken and the results reconciled with property records is completed at least once every two years. Views of responsible officials: In response to this finding management will implement the following: An education session occurred on February 7, 2024, with the relevant parties across the Cedars-Sinai Research Facilities department. The session focused on the uniform guidance, more specifically the requirements to perform a physical inventory of property at least once every two years as set forth in CFR 200.313 (d) (2). We will schedule follow up sessions in March 2024 (first session scheduled for March 1st, second session TBD) to review and update existing policies and procedures to ensure future transfer of knowledge, as well as finalize a plan of action in order to complete a physical inventory of research equipment by the end of the fiscal year period, June 2024.
Federal Agency: U.S. Department of Treasury Federal Program Name: Coronavirus State and Local Fiscal Recovery Funds (SLFRF) Assistance Listing Number: 21.027 Federal Award Identification Number and Year: Pub. L. No. 117-2 2021 Award Period: 5/10/2021 - 12/31/2026 Type of Finding: • Material Weakness in Internal Control over Compliance • Other Matters Criteria or specific requirement: According to§ 200.303 Internal controls of 2 CFR Part 200, the non-federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. According to the Coronavirus State and Local Fiscal Recovery Funds 2023 Program Compliance Supplement Part 4, recipients may use payments from SLFRF to replace lost public sector revenue to provide government services. Recipients may use this funding to provide government services to the extent of the reduction in revenue experienced due to the pandemic. The dollar amount of the revenue loss determines the limit for the amount of SLFRF funds that can be used to "provide government services" (which is one of four eligible uses of SLFRF funds). Condition: During our testing, we noted the City used SLFRF funds in excess of its estimated revenue loss. Management's Progress for Repeat Findings: This is a repeated and modified.finding. While the City has improved its efforts, there are still opportunities for improvement to reasonably ensure compliance with Federal laws, regulations, and program compliance requirements as well as compliance with City policy. Questioned costs: None Context: During our testing, it was noted that the City used SLFRF funds of $69,478,937.39 to provide government services in the revenue replacement expenditure category. However, the City calculated total estimated revenue loss of $66,909,843 comprised of 2020 and 2021 revenue loss of $10,042,104 and $56,867,739, respectively. The City's use of SLFRF funds was in excess of its estimated revenue loss by approximately $2,569,094. The City posted an entry moving the expenditures of $2,569,094 to the General Fund. Cause: The City did not perform a comparison of actual expenditures to the total estimated revenue loss to ensure the limit for the amount of SLFRF funds that can be used to "provide government services" was not exceeded by the City. Effect: The auditor noted an instance of noncompliance. Recommendation: We recommend the City implement a quarterly reconciliation process of actual expenditures to program limitations on use of funds to ensure limits are not exceeded on expenditures. Management Response: The City agrees with the finding. The City will ensure that the federal report preparers reconcile all entries to program limitations prior to having the report submitted for final certification. This will be complete by June 30, 2024. Timeline and Responsible Position: June 2024 - City Controller and Grants Administrator
Federal Agency: U.S. Department of Treasury Federal Program Name: Coronavirus State and Local Fiscal Recovery Funds (SLFRF) Emergency Rental Assistance Program Assistance Listing Number: 21.027 and 21.023 Federal Award Identification Number and Year: ALN 21.027 -Pub. L. No. 117-2 2021 ALN 21.023 -ERA0335 2021 ALN 21.023 - ERAOl 14 2021 Award Period: ALN 21.027 - 5/10/2021 - 12/31/2026 ALN 21.023 - 1/20/2021 - 9/30/2022 ALN 21.023 - 5/17/2021 - 9/30/2025 Type of Finding: • Material Weakness in Internal Control over Compliance • Other Matters Criteria or specific requirement: According to§ 200.302 Financial management of 2 CFR Part 200, the non-federal entity's financial management systems, including records documenting compliance with federal statutes, regulations, and the terms and conditions of the federal award, must be sufficient to permit the preparation of reports required by general and program -specific terms and conditions; and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the federal statutes, regulations, and the terms and conditions of the federal award. Further, the financial management system of each non-federal entity must provide accurate, current, and complete disclosure of the financial results of each federal award or program in accordance with the reporting requirements. According to § 200.303 Internal controls of 2 CFR Part 200, the non-federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: During our testing, it was noted that the City did not have effective internal controls in place to ensure accurate reporting. Management's Progress for Repeat Findings: This is a repeated and modified finding. While the City has improved its efforts, there are still opportunities for improvement to reasonably ensure compliance with Federal laws, regulations, and program compliance requirements as well as compliance with City policy. Questioned costs: None Context: During our testing, we noted the following exceptions related to reporting. ALN 21.027 • For the Project and Expenditure Report 5 and 6, it was noted that the City reported a total estimated revenue loss of $76,951,947.00 with 2022 accounting for $10,042,104.00 of the total. However, the City did not have any revenue loss for 2022. According to the City, its gross receipts tax grew 20.7% over the previous year in fiscal year 2022. • During the fiscal year 2023, the City incorrectly reported total cumulative expenditures of $29,700,000.00 for the Revenue Replacement First Responder Payroll project -Project Identifier Number 120. The amount reported should have been $27,130,906.00 resulting in a variance of $2,569,094.00. ALN 21.023 • For three of the four quarterly financial reports, the City was unable to reconcile the expenditure reports used as supporting documentation to the current quarter expenditures reported to the Treasury nor the schedule of expenditures of federal awards. Total variance of approximately $404,951 with ERAl Q3 2022 of $173,499, ERA2 Q4 2022 of $61,196, andERA2 Ql 2023 of$170,256. • For one of the five performance reports, the City was unable to provide documentation supporting the Total Dollar Amount of ERA funds Paid (Expended) and (Obligated) for Administrative Expenses of$312,822 related to key line item one -Administrative Costs Ratio. This is ERA Compliance Report for ERAl Q3 2022. • For one of the five performance reports, the City was unable to provide documentation supporting the number of unique households that received ERAl assistance over the award period of performance by income categories of 4,426 nor the number of unique recipient households whose income eligibility was determined based on their eligibility for other federal benefit programs of 9,489 related to key line item three -System for Prioritizing Assistance. This is ERA Compliance Report for ERAl Final Report. • For two of the five performance reports, it was noted that the total households receiving assistance was greater than the sum of Area Median Income (AMI) banded eligible households with a 5 to 10% margin of error to avoid false positives for medium to large recipients by 513 and 5,355 for ERAl Q3 2022 and ERAl Final Report, respectively. This is key line item four -Participant Households at Certain Income Levels Eligibility. • For one of the five performance reports, we were unable to trace the reported data to records that accumulate and summarize data for key line items one through four as the Demographics and Award Activity Amounts Approved (Obligated) and Amounts Paid (Expended) During the Quarter are blank in the Treasury report provided to us. This is ERA Compliance Report for ERA2 Ql 2023. Cause: Specific to the Project and Expenditure Report 5 and 6, the 2022 estimated revenue loss of $10,042,104.00 is a duplicate of the 2020 estimated revenue loss of $10,042,104.00. The City failed to identify this error prior to submission of the reports to the Treasury. Specific to the Revenue Replacement First Responder Payroll project, the City did not perform a comparison of actual expenditures to the total estimated revenue loss to ensure the limit for the amount of SLFRF funds that can be used to "provide government services" was not exceeded by the City. During the audit, the City posted an entry moving the expenditures of $2,569,094 to the General Fund. Specific to the remaining, the City lacks effective internal controls over financial grant management to ensure submitted reports are accurate and agree to supporting documentation. Effect: The auditor noted instances of noncompliance. Recommendation: We recommend the City implement a secondary review process of reports and supporting documentation prior to certification and submission of reports to federal funding agencies. Management Response: The City agrees with the finding. The Treasury Portal automatically fills in the amounts for revenue loss for 2022 with amounts reported in 2020. The Treasury portal has many flaws that would cause errors in reporting. In addition, the portal has changed every quarter, which makes it challenging to report accurately. The City will implement controls to ensure that a second review is completed prior to certification of the report. Additionally, the Grant Administrator will work with department staff responsible for reporting and ensure that each report's supporting documentation is complete and ties to underlying subrecipient reports, the general ledger and grantor reports. All supporting documentation, along with a copy of the submitted report, will be stored in a central location to ensure that they are available for subsequent reviews and audits. This will be completed by June 30, 2024. Timeline and Responsible Position: June 2024 - City Controller and Grants Administrator
Federal Agency: U.S. Department of Treasury Federal Program Name: Coronavirus State and Local Fiscal Recovery Funds (SLFRF) Emergency Rental Assistance Program Assistance Listing Number: 21.027 and 21.023 Federal Award Identification Number and Year: ALN 21.027 -Pub. L. No. 117-2 2021 ALN 21.023 -ERA0335 2021 ALN 21.023 - ERAOl 14 2021 Award Period: ALN 21.027 - 5/10/2021 - 12/31/2026 ALN 21.023 - 1/20/2021 - 9/30/2022 ALN 21.023 - 5/17/2021 - 9/30/2025 Type of Finding: • Material Weakness in Internal Control over Compliance • Other Matters Criteria or specific requirement: According to§ 200.302 Financial management of 2 CFR Part 200, the non-federal entity's financial management systems, including records documenting compliance with federal statutes, regulations, and the terms and conditions of the federal award, must be sufficient to permit the preparation of reports required by general and program -specific terms and conditions; and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the federal statutes, regulations, and the terms and conditions of the federal award. Further, the financial management system of each non-federal entity must provide accurate, current, and complete disclosure of the financial results of each federal award or program in accordance with the reporting requirements. According to § 200.303 Internal controls of 2 CFR Part 200, the non-federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: During our testing, it was noted that the City did not have effective internal controls in place to ensure accurate reporting. Management's Progress for Repeat Findings: This is a repeated and modified finding. While the City has improved its efforts, there are still opportunities for improvement to reasonably ensure compliance with Federal laws, regulations, and program compliance requirements as well as compliance with City policy. Questioned costs: None Context: During our testing, we noted the following exceptions related to reporting. ALN 21.027 • For the Project and Expenditure Report 5 and 6, it was noted that the City reported a total estimated revenue loss of $76,951,947.00 with 2022 accounting for $10,042,104.00 of the total. However, the City did not have any revenue loss for 2022. According to the City, its gross receipts tax grew 20.7% over the previous year in fiscal year 2022. • During the fiscal year 2023, the City incorrectly reported total cumulative expenditures of $29,700,000.00 for the Revenue Replacement First Responder Payroll project -Project Identifier Number 120. The amount reported should have been $27,130,906.00 resulting in a variance of $2,569,094.00. ALN 21.023 • For three of the four quarterly financial reports, the City was unable to reconcile the expenditure reports used as supporting documentation to the current quarter expenditures reported to the Treasury nor the schedule of expenditures of federal awards. Total variance of approximately $404,951 with ERAl Q3 2022 of $173,499, ERA2 Q4 2022 of $61,196, andERA2 Ql 2023 of$170,256. • For one of the five performance reports, the City was unable to provide documentation supporting the Total Dollar Amount of ERA funds Paid (Expended) and (Obligated) for Administrative Expenses of$312,822 related to key line item one -Administrative Costs Ratio. This is ERA Compliance Report for ERAl Q3 2022. • For one of the five performance reports, the City was unable to provide documentation supporting the number of unique households that received ERAl assistance over the award period of performance by income categories of 4,426 nor the number of unique recipient households whose income eligibility was determined based on their eligibility for other federal benefit programs of 9,489 related to key line item three -System for Prioritizing Assistance. This is ERA Compliance Report for ERAl Final Report. • For two of the five performance reports, it was noted that the total households receiving assistance was greater than the sum of Area Median Income (AMI) banded eligible households with a 5 to 10% margin of error to avoid false positives for medium to large recipients by 513 and 5,355 for ERAl Q3 2022 and ERAl Final Report, respectively. This is key line item four -Participant Households at Certain Income Levels Eligibility. • For one of the five performance reports, we were unable to trace the reported data to records that accumulate and summarize data for key line items one through four as the Demographics and Award Activity Amounts Approved (Obligated) and Amounts Paid (Expended) During the Quarter are blank in the Treasury report provided to us. This is ERA Compliance Report for ERA2 Ql 2023. Cause: Specific to the Project and Expenditure Report 5 and 6, the 2022 estimated revenue loss of $10,042,104.00 is a duplicate of the 2020 estimated revenue loss of $10,042,104.00. The City failed to identify this error prior to submission of the reports to the Treasury. Specific to the Revenue Replacement First Responder Payroll project, the City did not perform a comparison of actual expenditures to the total estimated revenue loss to ensure the limit for the amount of SLFRF funds that can be used to "provide government services" was not exceeded by the City. During the audit, the City posted an entry moving the expenditures of $2,569,094 to the General Fund. Specific to the remaining, the City lacks effective internal controls over financial grant management to ensure submitted reports are accurate and agree to supporting documentation. Effect: The auditor noted instances of noncompliance. Recommendation: We recommend the City implement a secondary review process of reports and supporting documentation prior to certification and submission of reports to federal funding agencies. Management Response: The City agrees with the finding. The Treasury Portal automatically fills in the amounts for revenue loss for 2022 with amounts reported in 2020. The Treasury portal has many flaws that would cause errors in reporting. In addition, the portal has changed every quarter, which makes it challenging to report accurately. The City will implement controls to ensure that a second review is completed prior to certification of the report. Additionally, the Grant Administrator will work with department staff responsible for reporting and ensure that each report's supporting documentation is complete and ties to underlying subrecipient reports, the general ledger and grantor reports. All supporting documentation, along with a copy of the submitted report, will be stored in a central location to ensure that they are available for subsequent reviews and audits. This will be completed by June 30, 2024. Timeline and Responsible Position: June 2024 - City Controller and Grants Administrator
Federal Agency: U.S. Department of Treasury Federal Program Name: Coronavirus State and Local Fiscal Recovery Funds (SLFRF) Emergency Rental Assistance Program Assistance Listing Number: 21.027 and 21.023 Federal Award Identification Numberand Year: ALN 21.027 -Pub. L. No. 117-2 2021 ALN 21.023 -ERA0335 2021 Award Period: ALN 21.027 - 5/10/2021 - 12/31/2026 ALN 21.023 - 1/20/2021 - 9/30/2022 Type of Finding: • Significant Deficiency in Internal Control over Compliance • Other Matters Criteria or specific requirement: According to§ 200.303 Internal controls of 2 CFR Part 200, the non-federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. According to § 200.331 Subrecipient and contractor determinations of 2 CFR Part 200, a pass-through entity must make case-by case determinations whether each agreement it makes for the disbursement of federal program funds casts the party receiving the funds in the role of a subrecipient or a contractor. According to § 200.332 Requirements for pass-through entities of 2 CFR Part 200, all pass-through entities must: • Evaluate each subrecipient's risk of noncompliance with federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring. • Monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, in compliance with federal statutes, regulations, and the terms and conditions of the subaward; and that subaward performance goals are achieved. • Verify that every subrecipient is audited as required by Subpart F ohhis part when it is expected that the subrecipient's federal awards expended during the respective fiscal year equaled or exceeded the threshold set forth in§ 200.501. • Consider whether the results of the subrecipient's audits, on-site reviews, or other monitoring indicate conditions that necessitate adjustments to the pass-through entity's own records. According to the City's subrecipient monitoring policies and procedures, monitoring of subrecipients shall be conducted as often as may be required at the discretion of the Community Development Division or at least once per program year. An annual Risk Assessment will be completed to determine a ranking for the activity. The Risk Assessment ranking score will determine whether a monitoring review will occur. According to the City's Sub-recipient Agreement, the Sub-recipient will provide to the Department of Family and Community Services cumulative quarterly program performance reports covering the Services provided under this Agreement. Reports are due no later than fifteen (15) days after the end of the reporting quarter, and shall be in accordance with City of Albuquerque reporting instructions. Condition: During our testing, it was noted that the City did not follow federal subrecipient monitoring and management regulation nor its subrecipient monitoring policies and procedures. Management's Progress for Repeat Findings: This is a repeated and modified.finding. While the City has improved its efforts, there are still opportunities for improvement to reasonably ensure compliance with Federal laws, regulations, and program compliance requirements as well as compliance with City policy. Questioned costs: None Context: During our testing, we noted the following exceptions related to subrecipient monitoring. ALN 21.027 • For one of the five subrecipients, the City did not utilize the risk assessment tool specific to ARPA which does have a different risk assessment ranking score determining the monitoring of the subrecipient. The City did, however, perform a monitoring visit for the subrecipient. • For one of the five subrecipients, the City was unable to locate the subrecipient/contract determination worksheet. • For one of the five subrecipients, the City was unable to locate the quarterly program performance reports submitted by the subrecipient. ALN 21.023 • For one of the five subrecipients, the most recent annual audit report for the year ended June 30, 2022 was not reviewed by the City nor included in the risk assessment. Cause: The City does not have sufficient internal controls to ensure appropriate risk assessment and subrecipient monitoring. Effect: The auditor noted instances of noncompliance. Recommendation: The City has developed standard City-wide subrecipient management and monitoring policies and procedures effective June 2023. We recommend the City design controls to ensure departments are abiding by the subrecipient management and monitoring policies and procedures including Individual departments that develop their own department specific and/or grant-specific subrecipient management policies and procedures. Management Response: The City agrees with the finding. The City's Grant Administrator will provide training to each City department which currently oversees subrecipients, ensuring that all department staff understand general and ARPA-specific subrecipient requirements. Additionally, the Grant Administrator will review City departments' subrecipient management checklists to ensure all required documentation is obtained from subrecipients and reviewed as required. This will be complete by June 30, 2024. Timeline and Responsible Position: June 2024 - Grants Administrator
Federal Agency: U.S. Department of Treasury Federal Program Name: Coronavirus State and Local Fiscal Recovery Funds (SLFRF) Emergency Rental Assistance Program Assistance Listing Number: 21.027 and 21.023 Federal Award Identification Numberand Year: ALN 21.027 -Pub. L. No. 117-2 2021 ALN 21.023 -ERA0335 2021 Award Period: ALN 21.027 - 5/10/2021 - 12/31/2026 ALN 21.023 - 1/20/2021 - 9/30/2022 Type of Finding: • Significant Deficiency in Internal Control over Compliance • Other Matters Criteria or specific requirement: According to§ 200.303 Internal controls of 2 CFR Part 200, the non-federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. According to § 200.331 Subrecipient and contractor determinations of 2 CFR Part 200, a pass-through entity must make case-by case determinations whether each agreement it makes for the disbursement of federal program funds casts the party receiving the funds in the role of a subrecipient or a contractor. According to § 200.332 Requirements for pass-through entities of 2 CFR Part 200, all pass-through entities must: • Evaluate each subrecipient's risk of noncompliance with federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring. • Monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, in compliance with federal statutes, regulations, and the terms and conditions of the subaward; and that subaward performance goals are achieved. • Verify that every subrecipient is audited as required by Subpart F ohhis part when it is expected that the subrecipient's federal awards expended during the respective fiscal year equaled or exceeded the threshold set forth in§ 200.501. • Consider whether the results of the subrecipient's audits, on-site reviews, or other monitoring indicate conditions that necessitate adjustments to the pass-through entity's own records. According to the City's subrecipient monitoring policies and procedures, monitoring of subrecipients shall be conducted as often as may be required at the discretion of the Community Development Division or at least once per program year. An annual Risk Assessment will be completed to determine a ranking for the activity. The Risk Assessment ranking score will determine whether a monitoring review will occur. According to the City's Sub-recipient Agreement, the Sub-recipient will provide to the Department of Family and Community Services cumulative quarterly program performance reports covering the Services provided under this Agreement. Reports are due no later than fifteen (15) days after the end of the reporting quarter, and shall be in accordance with City of Albuquerque reporting instructions. Condition: During our testing, it was noted that the City did not follow federal subrecipient monitoring and management regulation nor its subrecipient monitoring policies and procedures. Management's Progress for Repeat Findings: This is a repeated and modified.finding. While the City has improved its efforts, there are still opportunities for improvement to reasonably ensure compliance with Federal laws, regulations, and program compliance requirements as well as compliance with City policy. Questioned costs: None Context: During our testing, we noted the following exceptions related to subrecipient monitoring. ALN 21.027 • For one of the five subrecipients, the City did not utilize the risk assessment tool specific to ARPA which does have a different risk assessment ranking score determining the monitoring of the subrecipient. The City did, however, perform a monitoring visit for the subrecipient. • For one of the five subrecipients, the City was unable to locate the subrecipient/contract determination worksheet. • For one of the five subrecipients, the City was unable to locate the quarterly program performance reports submitted by the subrecipient. ALN 21.023 • For one of the five subrecipients, the most recent annual audit report for the year ended June 30, 2022 was not reviewed by the City nor included in the risk assessment. Cause: The City does not have sufficient internal controls to ensure appropriate risk assessment and subrecipient monitoring. Effect: The auditor noted instances of noncompliance. Recommendation: The City has developed standard City-wide subrecipient management and monitoring policies and procedures effective June 2023. We recommend the City design controls to ensure departments are abiding by the subrecipient management and monitoring policies and procedures including Individual departments that develop their own department specific and/or grant-specific subrecipient management policies and procedures. Management Response: The City agrees with the finding. The City's Grant Administrator will provide training to each City department which currently oversees subrecipients, ensuring that all department staff understand general and ARPA-specific subrecipient requirements. Additionally, the Grant Administrator will review City departments' subrecipient management checklists to ensure all required documentation is obtained from subrecipients and reviewed as required. This will be complete by June 30, 2024. Timeline and Responsible Position: June 2024 - Grants Administrator
Federal Agency: U.S. Department of Transportation Federal Program Name: Highway Planning and Construction Assistance Listing Number: 20.205 Federal Award Identification Number and Year: A301032 - 2021 35A301050M23E - 2015 693JJ22030000Z230NMA301050 - 2015 693JJ22130000M23ENMA300759 - 2021 693JJ22130000M230NMA300847 - 2021 693JJ22130000M23ENMA300847 - 2021 Pass-Through Agency: New Mexico Department of Transportation (NMDOT) Pass-Through Number(s): A301032, A301050, A300759, and A300847 Award Period: A301032 - 9/22/2021 - 9/30/2023 A301050 - 6/17/2015 - 6/26/2024 A300759 - 9/17/2021 - 3/27/2025 A300847 - 9/22/2021 - 12/30/2024 Type of Finding: • Significant Deficiency in Internal Control over Compliance • Other Matters Criteria or specific requirement: According to§ 200.303 Internal controls of 2 CFR Part 200, the non-federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. According to the 2023 Compliance Supplement Part 4, 20.001 Wage Rate Requirements Cross-Cutting Section, nonfederal entities shall include in their construction contracts subject to the Wage Rate Requirements (which still may be referenced as the Davis-Bacon Act) a provision that the contractor or subcontractor comply with those requirements and the DOL regulations. This includes a requirement for the contractor or subcontractor to submit to the nonfederal entity weekly, for each week in which any contract work is performed, a copy of the payroll and a statement of compliance (certified payrolls). According to the New Mexico Department of Transportation TLPA Handbook for Federal Projects, the contractor and each subcontractor shall furnish certified payrolls to the T/LPA for each consecutive week starting from the second week it performs work on the project. Certified payrolls shall be submitted by uploading required payroll information into LCPtracker. The T/LPA shall verify the data contained on each certified payroll and, should errors or discrepancies be found, the T/LPA shall reject the payroll in LCPtracker and notify the contractor or subcontractor of the error. The contractor or subcontractor will be required to correct the error and submit a revised payroll. The T/LPA may utilize Form A-1102, NMDOT Contractors and Subcontractors Payroll Checklist on a weekly basis. Condition: During our testing, we noted that the City did not follow wage rate requirements nor state requirements. Management's Progress for Repeat Findings: This is a repeated and modified.finding. While the City has improved its efforts, there are still opportunities for improvement to reasonably ensure compliance with Federal laws, regulations, and program compliance requirements as well as compliance with City policy. Questioned costs: None Context: During our testing, we noted the following exceptions related to wage rate requirements. • For one of the five contracts, the City does not have a monitoring process in place to ensure that the consultant hired to perform the duties related to certified payrolls is done correctly and in compliance with federal requirements. • For two of the five contracts, there are certified payrolls after the completion date on the change order provided to us. However, the City was unable to provide clarification or supporting documentation to confirm if the completion date on the change order provided to us is the final completion date. As such, we are unable to verify that the contractor or subcontractor submitted the required certified payrolls. • For one of the five contracts, the contract book was not provided to us. • For three of the five contracts, the City did not provide all of the signed and dated NMDOT contractors and subcontractors payroll checklists to us. Cause: The City was unaware of it being ultimately the responsible party for the project even in situations in which the City hires consultants. Specific to the remaining, the City lacks effective internal controls over wage rate requirements to ensure documentation is in place supporting compliance with federal requirements. Effect: The auditor noted instances of noncompliance. Recommendation: We recommend the City design controls to ensure compliance with federal and state wage rate requirements. Management Response: The City agrees with the finding. The Grant Administrator will work with City departments with construction contracts subject to wage rate requirements to ensure policies and procedures are documented and that a monitoring process is implemented to ensure adherence to established policies and grantor requirements. This will be complete by June 30, 2024. Timeline and Responsible Position: June 2024 - Grants Administrator
FINDING 2023-001 Subject: Research and Development Cluster - Subrecipient Monitoring Federal Agencies: National Science Foundation, US Department of Education Federal Programs: Social, Behavioral, and Economic Sciences; Higher Education Institutional Aid Assistance Listings Numbers: 47.075, 84.031 Federal Award Numbers and Years (or Other Identifying Numbers): 1759694, P031F180072 Compliance Requirement: Subrecipient Monitoring Audit Findings: Material Weakness, Other Matters Condition and Context The University expended $1,076,005 in Research and Development funds during the audit period. Of that amount, $86,788 was passed through to five subrecipients. As a pass-through entity, the University was required to identify the award and applicable requirements and monitor the subrecipient. Procedures to monitor its subrecipients included the following: Reviewing financial and programmatic reports as required by the University. Following up and ensuring the subrecipient takes timely and appropriate actions on all deficiencies pertaining to the federal award provided to the subrecipient detected through audits, on-site reviews, and other means. Issuing a management decision for audit findings pertaining to the federal award provided to the subrecipient. All five subrecipients expended more than $750,000 in federal awards in fiscal year 2022, thus subjecting each to a Single Audit as required by the Uniform Guidance. As such, each subrecipient was required to submit its Single Audit report to the Federal Audit Clearinghouse (FAC) by March 31, 2023. In November 2023, eight months after the subrecipients' report submission deadline, the University completed the review of the fiscal year 2022 audit reports for all five subrecipients. The delayed monitoring would not have allowed the University to follow up and ensure that the subrecipients took timely and appropriate action on all deficiencies pertaining to the federal awards passed through to the subrecipients from the University. In addition, it would not have allowed for the University to issue a management decision for audit findings pertaining to the federal award provided to the subrecipient within six months of acceptance by the FAC. The lack of effective internal controls and noncompliance, as related to the monitoring of the five subrecipients, were systemic issues throughout the audit period. INDIANA STATE BOARD OF ACCOUNTS 15 INDIANA STATE UNIVERSITY SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.332 states in part: "All pass-through entities must: . . . (d) Monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, in compliance with Federal statutes, regulations, and the terms and conditions of the subaward; and that subaward performance goals are achieved. Pass-through entity monitoring of the subrecipient must include: . . . (2) Following-up and ensuring that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the Federal award provided to the subrecipient from the pass-through entity detected through audits, on-site reviews, and written confirmation from the subrecipient, highlighting the status of actions planned or taken to address Single Audit findings related to the particular subaward. (3) Issuing a management decision for applicable audit findings pertaining only to the Federal award provided to the subrecipient from the pass-through entity as required by § 200.521. . . ." 2 CFR 200.521(d) states in part: "The federal awarding agency or pass-through entity responsible for issuing a management decision must do so within six months of acceptance of the audit report by the FAC. . . ." Cause The system of internal controls as developed by management of the University was not properly implemented to ensure that subrecipient audit reports were received and reviewed in a timely manner. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, subrecipients to whom payments were made were not adequately monitored. The failure to establish a sufficient system of internal controls allowed noncompliance with the grant agreements and the Subrecipient Monitoring compliance requirement. INDIANA STATE BOARD OF ACCOUNTS 16 INDIANA STATE UNIVERSITY SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Questioned Costs There were no questioned costs identified. Recommendation We recommended that the University's management establish a system of internal controls, including segregation of duties, related to the grant agreements and compliance requirements listed above. An internal control system, including segregation of duties, should be designed and operate effectively to provide reasonable assurance that material noncompliance with the grant agreement or a compliance requirement of a federal program will be prevented, or detected and corrected, on a timely basis. In order to have an effective internal control system, it is important to have proper segregation of duties. This is accomplished by making sure proper oversight, reviews, and approvals take place and to have a separation of functions over certain activities related to the program. The fundamental premise of segregation of duties is that an individual or small group of individuals should not be in a position to initiate, approve, undertake, and review the same activity. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-001 Subject: Research and Development Cluster - Subrecipient Monitoring Federal Agencies: National Science Foundation, US Department of Education Federal Programs: Social, Behavioral, and Economic Sciences; Higher Education Institutional Aid Assistance Listings Numbers: 47.075, 84.031 Federal Award Numbers and Years (or Other Identifying Numbers): 1759694, P031F180072 Compliance Requirement: Subrecipient Monitoring Audit Findings: Material Weakness, Other Matters Condition and Context The University expended $1,076,005 in Research and Development funds during the audit period. Of that amount, $86,788 was passed through to five subrecipients. As a pass-through entity, the University was required to identify the award and applicable requirements and monitor the subrecipient. Procedures to monitor its subrecipients included the following: Reviewing financial and programmatic reports as required by the University. Following up and ensuring the subrecipient takes timely and appropriate actions on all deficiencies pertaining to the federal award provided to the subrecipient detected through audits, on-site reviews, and other means. Issuing a management decision for audit findings pertaining to the federal award provided to the subrecipient. All five subrecipients expended more than $750,000 in federal awards in fiscal year 2022, thus subjecting each to a Single Audit as required by the Uniform Guidance. As such, each subrecipient was required to submit its Single Audit report to the Federal Audit Clearinghouse (FAC) by March 31, 2023. In November 2023, eight months after the subrecipients' report submission deadline, the University completed the review of the fiscal year 2022 audit reports for all five subrecipients. The delayed monitoring would not have allowed the University to follow up and ensure that the subrecipients took timely and appropriate action on all deficiencies pertaining to the federal awards passed through to the subrecipients from the University. In addition, it would not have allowed for the University to issue a management decision for audit findings pertaining to the federal award provided to the subrecipient within six months of acceptance by the FAC. The lack of effective internal controls and noncompliance, as related to the monitoring of the five subrecipients, were systemic issues throughout the audit period. INDIANA STATE BOARD OF ACCOUNTS 15 INDIANA STATE UNIVERSITY SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.332 states in part: "All pass-through entities must: . . . (d) Monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, in compliance with Federal statutes, regulations, and the terms and conditions of the subaward; and that subaward performance goals are achieved. Pass-through entity monitoring of the subrecipient must include: . . . (2) Following-up and ensuring that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the Federal award provided to the subrecipient from the pass-through entity detected through audits, on-site reviews, and written confirmation from the subrecipient, highlighting the status of actions planned or taken to address Single Audit findings related to the particular subaward. (3) Issuing a management decision for applicable audit findings pertaining only to the Federal award provided to the subrecipient from the pass-through entity as required by § 200.521. . . ." 2 CFR 200.521(d) states in part: "The federal awarding agency or pass-through entity responsible for issuing a management decision must do so within six months of acceptance of the audit report by the FAC. . . ." Cause The system of internal controls as developed by management of the University was not properly implemented to ensure that subrecipient audit reports were received and reviewed in a timely manner. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, subrecipients to whom payments were made were not adequately monitored. The failure to establish a sufficient system of internal controls allowed noncompliance with the grant agreements and the Subrecipient Monitoring compliance requirement. INDIANA STATE BOARD OF ACCOUNTS 16 INDIANA STATE UNIVERSITY SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Questioned Costs There were no questioned costs identified. Recommendation We recommended that the University's management establish a system of internal controls, including segregation of duties, related to the grant agreements and compliance requirements listed above. An internal control system, including segregation of duties, should be designed and operate effectively to provide reasonable assurance that material noncompliance with the grant agreement or a compliance requirement of a federal program will be prevented, or detected and corrected, on a timely basis. In order to have an effective internal control system, it is important to have proper segregation of duties. This is accomplished by making sure proper oversight, reviews, and approvals take place and to have a separation of functions over certain activities related to the program. The fundamental premise of segregation of duties is that an individual or small group of individuals should not be in a position to initiate, approve, undertake, and review the same activity. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
Finding 2023-001: Procurement: Suspension and Debarment Federal Program Research and Development Cluster (R&D) (AL No.: Various) Federal Agency National Institute of Standards and Technology Federal Award Number Award numbers: 70NANB21H085, 70NANB21H086, 70NANB17H002 Federal Award Year July 1, 2022 through June 30, 2023 Criteria or Requirement Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. Covered transactions include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain others criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. When a non-federal entity enters into a covered transaction with an entity at a lower tier, the non-federal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. This verification may be accomplished by (1) checking the System for Award Management (SAM) Exclusions maintained by the General Services Administration (GSA) and available at SAM.gov | Home (click on Search Record, then click on Advanced Search-Exclusions) (Note: The OMB guidance at 2 CFR Part 180 and agency implementing regulations still refer to the SAM Exclusions as the Excluded Parties List System (EPLS)), (2) collecting a certification from the entity, or (3) adding a clause or condition to the covered transaction with that entity (2 CFR section 180.300). Per 2 CFR Section 200.303, the non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition Found, including Perspective In our testing over suspension and debarment, we identified two covered transactions, both with the same vendor, in a sample of 40 procurement transactions for which the University was unable to provide supporting documentation that they verified the vendor was not suspended or debarred prior to entering into the procurement transaction with the vendor. It was determined that the related vendor was not suspended or debarred. Possible Cause and Effect The University’s internal control over compliance with federal procurement suspension and debarment was not operating consistently through fiscal year 2023, including obtaining and maintaining appropriate documentation. Failure to implement sufficient internal controls to verify the University does not enter into covered transactions with parties that are suspended or debarred in accordance with federal regulations increases the risk of noncompliance. Questioned Costs No questioned costs were identified. Statistical Validity The sample was not intended to be, and was not, a statistically valid sample. Repeat Finding in the Prior Year Yes Recommendation We recommend the University enhance its internal control over compliance with the federal regulations related to suspension and debarment to ensure covered transactions are not entered into with parties that have been suspended or debarred. Views of Responsible Officials The University agrees with the finding. The University has taken additional measures to ensure a clause with suspension and debarment language is included within the contracts of all new covered transactions entered into on or after July 1, 2023. The finding relates to a legacy contract and has prompted a review of open purchase orders to address suspension and debarment requirements. Additionally, the University will begin utilizing a third-party verification software to screen existing and potential vendors against the System for Award Management (SAM.gov) Exclusions list daily, with an expected implementation by June 30, 2024.
Finding 2023-001: Procurement: Suspension and Debarment Federal Program Research and Development Cluster (R&D) (AL No.: Various) Federal Agency National Institute of Standards and Technology Federal Award Number Award numbers: 70NANB21H085, 70NANB21H086, 70NANB17H002 Federal Award Year July 1, 2022 through June 30, 2023 Criteria or Requirement Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. Covered transactions include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain others criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. When a non-federal entity enters into a covered transaction with an entity at a lower tier, the non-federal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. This verification may be accomplished by (1) checking the System for Award Management (SAM) Exclusions maintained by the General Services Administration (GSA) and available at SAM.gov | Home (click on Search Record, then click on Advanced Search-Exclusions) (Note: The OMB guidance at 2 CFR Part 180 and agency implementing regulations still refer to the SAM Exclusions as the Excluded Parties List System (EPLS)), (2) collecting a certification from the entity, or (3) adding a clause or condition to the covered transaction with that entity (2 CFR section 180.300). Per 2 CFR Section 200.303, the non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition Found, including Perspective In our testing over suspension and debarment, we identified two covered transactions, both with the same vendor, in a sample of 40 procurement transactions for which the University was unable to provide supporting documentation that they verified the vendor was not suspended or debarred prior to entering into the procurement transaction with the vendor. It was determined that the related vendor was not suspended or debarred. Possible Cause and Effect The University’s internal control over compliance with federal procurement suspension and debarment was not operating consistently through fiscal year 2023, including obtaining and maintaining appropriate documentation. Failure to implement sufficient internal controls to verify the University does not enter into covered transactions with parties that are suspended or debarred in accordance with federal regulations increases the risk of noncompliance. Questioned Costs No questioned costs were identified. Statistical Validity The sample was not intended to be, and was not, a statistically valid sample. Repeat Finding in the Prior Year Yes Recommendation We recommend the University enhance its internal control over compliance with the federal regulations related to suspension and debarment to ensure covered transactions are not entered into with parties that have been suspended or debarred. Views of Responsible Officials The University agrees with the finding. The University has taken additional measures to ensure a clause with suspension and debarment language is included within the contracts of all new covered transactions entered into on or after July 1, 2023. The finding relates to a legacy contract and has prompted a review of open purchase orders to address suspension and debarment requirements. Additionally, the University will begin utilizing a third-party verification software to screen existing and potential vendors against the System for Award Management (SAM.gov) Exclusions list daily, with an expected implementation by June 30, 2024.
Criteria or specific requirement: The Federal Government requires that when the reimbursement method is used, the Federal awarding agency or pass-through entity must make payment within 30 calendar days after receipt of the billing, unless the Federal awarding agency or pass-through entity reasonably believes the request to be improper (2 CFR section 200.305(b)(3)). Per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Condition: The University did not make payment to Subrecipients within the required 30 calendar days after receipt of the billing. Context: Nine exceptions were identified in a sample of forty subrecipient draw requests. Of the nine exceptions noted, exceptions ranged from 31 days to 90 days. Questioned costs: None. Cause: There was a misunderstanding of processes from backup staff. Additionally, there were delays in the department resulting in invoices not being processed timely. Lastly, approvals from the respective Principal Investigators were not being routed correctly. Effect: Subrecipients did not receive their reimbursement timely and in accordance with federal regulations. Repeat finding: No Recommendation: We recommend the University evaluate its procedures and implement an additional control to review and approve the subrecipient reimbursements timely. Views of responsible officials: Management agrees with the finding and has developed a plan to correct the finding.
Criteria or specific requirement: The Federal Government requires that when the reimbursement method is used, the Federal awarding agency or pass-through entity must make payment within 30 calendar days after receipt of the billing, unless the Federal awarding agency or pass-through entity reasonably believes the request to be improper (2 CFR section 200.305(b)(3)). Per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Condition: The University did not make payment to Subrecipients within the required 30 calendar days after receipt of the billing. Context: Nine exceptions were identified in a sample of forty subrecipient draw requests. Of the nine exceptions noted, exceptions ranged from 31 days to 90 days. Questioned costs: None. Cause: There was a misunderstanding of processes from backup staff. Additionally, there were delays in the department resulting in invoices not being processed timely. Lastly, approvals from the respective Principal Investigators were not being routed correctly. Effect: Subrecipients did not receive their reimbursement timely and in accordance with federal regulations. Repeat finding: No Recommendation: We recommend the University evaluate its procedures and implement an additional control to review and approve the subrecipient reimbursements timely. Views of responsible officials: Management agrees with the finding and has developed a plan to correct the finding.
Criteria or specific requirement: The Federal Government requires that when the reimbursement method is used, the Federal awarding agency or pass-through entity must make payment within 30 calendar days after receipt of the billing, unless the Federal awarding agency or pass-through entity reasonably believes the request to be improper (2 CFR section 200.305(b)(3)). Per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Condition: The University did not make payment to Subrecipients within the required 30 calendar days after receipt of the billing. Context: Nine exceptions were identified in a sample of forty subrecipient draw requests. Of the nine exceptions noted, exceptions ranged from 31 days to 90 days. Questioned costs: None. Cause: There was a misunderstanding of processes from backup staff. Additionally, there were delays in the department resulting in invoices not being processed timely. Lastly, approvals from the respective Principal Investigators were not being routed correctly. Effect: Subrecipients did not receive their reimbursement timely and in accordance with federal regulations. Repeat finding: No Recommendation: We recommend the University evaluate its procedures and implement an additional control to review and approve the subrecipient reimbursements timely. Views of responsible officials: Management agrees with the finding and has developed a plan to correct the finding.
Criteria or specific requirement: The Federal Government requires that when the reimbursement method is used, the Federal awarding agency or pass-through entity must make payment within 30 calendar days after receipt of the billing, unless the Federal awarding agency or pass-through entity reasonably believes the request to be improper (2 CFR section 200.305(b)(3)). Per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Condition: The University did not make payment to Subrecipients within the required 30 calendar days after receipt of the billing. Context: Nine exceptions were identified in a sample of forty subrecipient draw requests. Of the nine exceptions noted, exceptions ranged from 31 days to 90 days. Questioned costs: None. Cause: There was a misunderstanding of processes from backup staff. Additionally, there were delays in the department resulting in invoices not being processed timely. Lastly, approvals from the respective Principal Investigators were not being routed correctly. Effect: Subrecipients did not receive their reimbursement timely and in accordance with federal regulations. Repeat finding: No Recommendation: We recommend the University evaluate its procedures and implement an additional control to review and approve the subrecipient reimbursements timely. Views of responsible officials: Management agrees with the finding and has developed a plan to correct the finding.
Criteria or specific requirement: The Federal Government requires that when the reimbursement method is used, the Federal awarding agency or pass-through entity must make payment within 30 calendar days after receipt of the billing, unless the Federal awarding agency or pass-through entity reasonably believes the request to be improper (2 CFR section 200.305(b)(3)). Per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Condition: The University did not make payment to Subrecipients within the required 30 calendar days after receipt of the billing. Context: Nine exceptions were identified in a sample of forty subrecipient draw requests. Of the nine exceptions noted, exceptions ranged from 31 days to 90 days. Questioned costs: None. Cause: There was a misunderstanding of processes from backup staff. Additionally, there were delays in the department resulting in invoices not being processed timely. Lastly, approvals from the respective Principal Investigators were not being routed correctly. Effect: Subrecipients did not receive their reimbursement timely and in accordance with federal regulations. Repeat finding: No Recommendation: We recommend the University evaluate its procedures and implement an additional control to review and approve the subrecipient reimbursements timely. Views of responsible officials: Management agrees with the finding and has developed a plan to correct the finding.
Criteria or specific requirement: The Federal Government requires that when the reimbursement method is used, the Federal awarding agency or pass-through entity must make payment within 30 calendar days after receipt of the billing, unless the Federal awarding agency or pass-through entity reasonably believes the request to be improper (2 CFR section 200.305(b)(3)). Per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Condition: The University did not make payment to Subrecipients within the required 30 calendar days after receipt of the billing. Context: Nine exceptions were identified in a sample of forty subrecipient draw requests. Of the nine exceptions noted, exceptions ranged from 31 days to 90 days. Questioned costs: None. Cause: There was a misunderstanding of processes from backup staff. Additionally, there were delays in the department resulting in invoices not being processed timely. Lastly, approvals from the respective Principal Investigators were not being routed correctly. Effect: Subrecipients did not receive their reimbursement timely and in accordance with federal regulations. Repeat finding: No Recommendation: We recommend the University evaluate its procedures and implement an additional control to review and approve the subrecipient reimbursements timely. Views of responsible officials: Management agrees with the finding and has developed a plan to correct the finding.
Criteria or specific requirement: The Federal Government requires that when the reimbursement method is used, the Federal awarding agency or pass-through entity must make payment within 30 calendar days after receipt of the billing, unless the Federal awarding agency or pass-through entity reasonably believes the request to be improper (2 CFR section 200.305(b)(3)). Per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Condition: The University did not make payment to Subrecipients within the required 30 calendar days after receipt of the billing. Context: Nine exceptions were identified in a sample of forty subrecipient draw requests. Of the nine exceptions noted, exceptions ranged from 31 days to 90 days. Questioned costs: None. Cause: There was a misunderstanding of processes from backup staff. Additionally, there were delays in the department resulting in invoices not being processed timely. Lastly, approvals from the respective Principal Investigators were not being routed correctly. Effect: Subrecipients did not receive their reimbursement timely and in accordance with federal regulations. Repeat finding: No Recommendation: We recommend the University evaluate its procedures and implement an additional control to review and approve the subrecipient reimbursements timely. Views of responsible officials: Management agrees with the finding and has developed a plan to correct the finding.
Criteria or specific requirement: The Federal Government requires that when the reimbursement method is used, the Federal awarding agency or pass-through entity must make payment within 30 calendar days after receipt of the billing, unless the Federal awarding agency or pass-through entity reasonably believes the request to be improper (2 CFR section 200.305(b)(3)). Per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Condition: The University did not make payment to Subrecipients within the required 30 calendar days after receipt of the billing. Context: Nine exceptions were identified in a sample of forty subrecipient draw requests. Of the nine exceptions noted, exceptions ranged from 31 days to 90 days. Questioned costs: None. Cause: There was a misunderstanding of processes from backup staff. Additionally, there were delays in the department resulting in invoices not being processed timely. Lastly, approvals from the respective Principal Investigators were not being routed correctly. Effect: Subrecipients did not receive their reimbursement timely and in accordance with federal regulations. Repeat finding: No Recommendation: We recommend the University evaluate its procedures and implement an additional control to review and approve the subrecipient reimbursements timely. Views of responsible officials: Management agrees with the finding and has developed a plan to correct the finding.
Criteria or specific requirement: The Federal Government requires that when the reimbursement method is used, the Federal awarding agency or pass-through entity must make payment within 30 calendar days after receipt of the billing, unless the Federal awarding agency or pass-through entity reasonably believes the request to be improper (2 CFR section 200.305(b)(3)). Per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Condition: The University did not make payment to Subrecipients within the required 30 calendar days after receipt of the billing. Context: Nine exceptions were identified in a sample of forty subrecipient draw requests. Of the nine exceptions noted, exceptions ranged from 31 days to 90 days. Questioned costs: None. Cause: There was a misunderstanding of processes from backup staff. Additionally, there were delays in the department resulting in invoices not being processed timely. Lastly, approvals from the respective Principal Investigators were not being routed correctly. Effect: Subrecipients did not receive their reimbursement timely and in accordance with federal regulations. Repeat finding: No Recommendation: We recommend the University evaluate its procedures and implement an additional control to review and approve the subrecipient reimbursements timely. Views of responsible officials: Management agrees with the finding and has developed a plan to correct the finding.
Criteria or specific requirement: The Federal Government requires that when the reimbursement method is used, the Federal awarding agency or pass-through entity must make payment within 30 calendar days after receipt of the billing, unless the Federal awarding agency or pass-through entity reasonably believes the request to be improper (2 CFR section 200.305(b)(3)). Per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Condition: The University did not make payment to Subrecipients within the required 30 calendar days after receipt of the billing. Context: Nine exceptions were identified in a sample of forty subrecipient draw requests. Of the nine exceptions noted, exceptions ranged from 31 days to 90 days. Questioned costs: None. Cause: There was a misunderstanding of processes from backup staff. Additionally, there were delays in the department resulting in invoices not being processed timely. Lastly, approvals from the respective Principal Investigators were not being routed correctly. Effect: Subrecipients did not receive their reimbursement timely and in accordance with federal regulations. Repeat finding: No Recommendation: We recommend the University evaluate its procedures and implement an additional control to review and approve the subrecipient reimbursements timely. Views of responsible officials: Management agrees with the finding and has developed a plan to correct the finding.
Criteria or specific requirement: The Federal Government requires that when the reimbursement method is used, the Federal awarding agency or pass-through entity must make payment within 30 calendar days after receipt of the billing, unless the Federal awarding agency or pass-through entity reasonably believes the request to be improper (2 CFR section 200.305(b)(3)). Per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Condition: The University did not make payment to Subrecipients within the required 30 calendar days after receipt of the billing. Context: Nine exceptions were identified in a sample of forty subrecipient draw requests. Of the nine exceptions noted, exceptions ranged from 31 days to 90 days. Questioned costs: None. Cause: There was a misunderstanding of processes from backup staff. Additionally, there were delays in the department resulting in invoices not being processed timely. Lastly, approvals from the respective Principal Investigators were not being routed correctly. Effect: Subrecipients did not receive their reimbursement timely and in accordance with federal regulations. Repeat finding: No Recommendation: We recommend the University evaluate its procedures and implement an additional control to review and approve the subrecipient reimbursements timely. Views of responsible officials: Management agrees with the finding and has developed a plan to correct the finding.
Criteria or specific requirement: The Federal Government requires that when the reimbursement method is used, the Federal awarding agency or pass-through entity must make payment within 30 calendar days after receipt of the billing, unless the Federal awarding agency or pass-through entity reasonably believes the request to be improper (2 CFR section 200.305(b)(3)). Per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Condition: The University did not make payment to Subrecipients within the required 30 calendar days after receipt of the billing. Context: Nine exceptions were identified in a sample of forty subrecipient draw requests. Of the nine exceptions noted, exceptions ranged from 31 days to 90 days. Questioned costs: None. Cause: There was a misunderstanding of processes from backup staff. Additionally, there were delays in the department resulting in invoices not being processed timely. Lastly, approvals from the respective Principal Investigators were not being routed correctly. Effect: Subrecipients did not receive their reimbursement timely and in accordance with federal regulations. Repeat finding: No Recommendation: We recommend the University evaluate its procedures and implement an additional control to review and approve the subrecipient reimbursements timely. Views of responsible officials: Management agrees with the finding and has developed a plan to correct the finding.
Criteria or specific requirement: The Federal Government requires that when the reimbursement method is used, the Federal awarding agency or pass-through entity must make payment within 30 calendar days after receipt of the billing, unless the Federal awarding agency or pass-through entity reasonably believes the request to be improper (2 CFR section 200.305(b)(3)). Per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Condition: The University did not make payment to Subrecipients within the required 30 calendar days after receipt of the billing. Context: Nine exceptions were identified in a sample of forty subrecipient draw requests. Of the nine exceptions noted, exceptions ranged from 31 days to 90 days. Questioned costs: None. Cause: There was a misunderstanding of processes from backup staff. Additionally, there were delays in the department resulting in invoices not being processed timely. Lastly, approvals from the respective Principal Investigators were not being routed correctly. Effect: Subrecipients did not receive their reimbursement timely and in accordance with federal regulations. Repeat finding: No Recommendation: We recommend the University evaluate its procedures and implement an additional control to review and approve the subrecipient reimbursements timely. Views of responsible officials: Management agrees with the finding and has developed a plan to correct the finding.