Finding 2022-003 Criteria or Specific Requirement: The Code of Federal Regulations Section 200.322(b) states that the pass-through entity must evaluate the subrecipient's risk of noncompliance with Federal statutes and Section 200.332(d) states that the pass-through entity must monitor the activities of the subrecipient as necessary to ensure that the subawards is used for authorized purposes. Condition: During our review of subrecipient monitoring, it was noted that no formal written policy is maintained. Cause: The Organization does not have written policies and procedures to monitor subrecipient's activities in accordance with the Uniform Guidance requirements. Effect or Potential Effect: The deficiency increases the risk that subawards could be spent for purposes other than those outlined in the grant agreements. Context: The Organization provides subawards to grant recipients. Its monitoring procedures consist of approvals over the expenditures but lack the requirements set forth by 2 CFR 200.332. Questioned costs: None noted. Repeat finding: No. Recommendation: We recommend the Organization's subrecipient monitoring policies and procedures be reviewed and updated for compliance with the Uniform Guidance requirements. Additionally, we recommend the Organization review all policies and procedures annually, or more frequently, if necessary, to reflect changes to laws, regulations, personnel, and/or internal procedures. Views of Responsible Officials: Management agrees with the finding and will implement a process to documents its policies and ensure they meet the subrecipient monitoring requirements.
Finding 2022-003 Criteria or Specific Requirement: The Code of Federal Regulations Section 200.322(b) states that the pass-through entity must evaluate the subrecipient's risk of noncompliance with Federal statutes and Section 200.332(d) states that the pass-through entity must monitor the activities of the subrecipient as necessary to ensure that the subawards is used for authorized purposes. Condition: During our review of subrecipient monitoring, it was noted that no formal written policy is maintained. Cause: The Organization does not have written policies and procedures to monitor subrecipient's activities in accordance with the Uniform Guidance requirements. Effect or Potential Effect: The deficiency increases the risk that subawards could be spent for purposes other than those outlined in the grant agreements. Context: The Organization provides subawards to grant recipients. Its monitoring procedures consist of approvals over the expenditures but lack the requirements set forth by 2 CFR 200.332. Questioned costs: None noted. Repeat finding: No. Recommendation: We recommend the Organization's subrecipient monitoring policies and procedures be reviewed and updated for compliance with the Uniform Guidance requirements. Additionally, we recommend the Organization review all policies and procedures annually, or more frequently, if necessary, to reflect changes to laws, regulations, personnel, and/or internal procedures. Views of Responsible Officials: Management agrees with the finding and will implement a process to documents its policies and ensure they meet the subrecipient monitoring requirements.
2022-002 ? CORONAVIRUS STATE AND LOCAL FISCAL RECOVERY FUNDS ? NONCOMPLIANCE WITH SUBRECIPIENT GRANT AGREEMENT REQUIREMENTS ? ALN 21.027 ? OTHER NONCOMPLIANCE FINDING TYPE: Other Noncompliance Finding 2022-002 Federal Program: Coronavirus State and Local Fiscal Recovery Funds ALN: 21.027 Federal Award Number(s) and Year(s): SLFRP1964, 2022 Federal Agency: U.S. Department of Treasury Questioned Cost: $0 Condition Burleigh County did not communicate and document all of the elements as outlined in 2 CFR 200.332(a) for the subrecipients of the Coronavirus State and Local Fiscal Recovery Funds program. During testing, we noted the following elements were not included: ? subrecipient's unique entity identifier ? federal award identification number ? federal award date (see definition of Federal award date ? 200.1) of award to the recipient by the Federal agency ? subaward period of performance start and end date ? name of Federal awarding agency, pass-through entity, and contact information for awarding official of the Pass-through entity ? Assistance Listings number and Title ? identification of whether the award is Research and Development ? indirect cost rate for the Federal award (including if the de minimis rate is charged) per ?200.414 ? a requirement that the subrecipient permit the pass-through entity and auditors to have access to the subrecipient's records and financial statements as necessary for the pass-through entity to meet the requirements of this part, and appropriate terms and conditions concerning closeout of the subaward Effect Burleigh County did not comply with all elements of 2 CFR 200.332(a). Therefore, subrecipients may not have been aware of all necessary grant information and requirements. Cause Burleigh County was not aware of the requirements set forth in 2 CFR 200.332(a) that needed to be included in the grant agreements. Criteria 31 U.S.C 7502(f)(2)(A) states that each pass-through entity shall provide subrecipient the Federal requirements which govern the use of such awards. 2 CFR 200.332(a) states the required information that pass-through entities must disclose. This includes information related to federal award identification and period of performance, approved federally recognized indirect cost rate, requirement that the subrecipient allow access to records, and appropriate terms and conditions concerning closeout of the subaward. Repeat Finding Yes. Recommendation We recommend Burleigh County ensure that all elements as outlined in 2 CFR 200.332(a) are communicated and documented to the subrecipients of the Coronavirus State and Local Fiscal Recovery Funds program. Burleigh County?s Response See Corrective Action Plan
Finding 2022-001 Significant deficiency in internal controls over compliance and instances of noncompliance related to subrecipient monitoring. Federal Agency: Department of the Treasury Program Title: Coronavirus State and Local Fiscal Recovery Fund Assistance Listing: 21.027 Award Number: DA21-2000 Award Period: October 1, 2021 - December 31, 2022 Criteria 2 U.S. Code of Federal Regulations (CFR) 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) Subpart D (as codified by the Department of Treasury in CFR OPEN) require a pass-through entity to adopt compliance policies, include certain provisions in subaward agreements, and evaluate each subrecipient?s risk of noncompliance with Federal statutes, regulations, and the terms and conditions of such agreements for the purposes of determining appropriate subrecipient monitoring. Condition/Context for Evaluation In a population of three subrecipients, the subaward agreements did not include all required provisions outlined in 2 CFR 200.332. Additionally, the Organization?s subrecipient monitoring policy did not include a provision requiring a formal documented risk assessment, and as such no documentation was available showing an assessment of the risk of noncompliance of the subrecipients. Monitoring was performed over all subrecipients as noted in the Organization?s policy. Effect or Potential Effect The Organization did not fully comply with the requirements regarding subaward agreements and evaluating each subrecipients risk of noncompliance for the purposes of determining the appropriate subrecipient monitoring. Questioned Costs Not Applicable Cause Internal controls were not effective in ensuring that the Organization?s subrecipient monitoring policies were in compliance with the Uniform Guidance requirements. Repeat Finding No Recommendation We recommend that the Organization update the subrecipient monitoring policy to ensure subaward agreements include all necessary provisions and documentation of risk assessment is retained. Views of Responsible Officials of Auditee Management agrees with the finding and has provided the accompanying corrective action plan.
Federal Agency: Department of Health and Human Services Federal Program: Research and Development Cluster Assistance Listing Number: 93.847 & 93.867 Federal Award Identification Number and Year: Various Award Period: January 1, 2022, through December 31, 2022 Type of Finding: Other Matters Finding related to Compliance within Uniform Guidance and Material Weakness in Internal Control Over Compliance Criteria or Specific Requirement: According to 2 CFR Part 200, Subpart D, Section 200.332, pass-through entities are required to perform certain subrecipient monitoring procedures. These procedures include providing the subrecipient necessary award information so that the federal award is used in accordance with federal regulations, evaluating risks of noncompliance of subrecipients, implementing monitoring procedures based upon identified risks, and obtaining a copy of the subrecipients? annual audit and taking appropriate action on deficiencies detected through the audits, just to name a few. Lastly, in accordance with 2 CFR Title 2, Subtitle A, Chapter 2, Part 200, Subpart D, 200.303, the non-federal entity must establish and maintain effective internal controls over the federal award to provide reasonable assurance that the non-federal entity is managing the award in compliance with federal regulations. Condition: The Organization did not verify whether the subject subrecipients received a required annual audit under 2 CFR Part 200. By not verifying and obtaining a copy of the most recent audit of the subrecipients, the Organization was unaware if any enforcement actions against noncompliant subrecipients had occurred. Context: During our testing, it was noted that the Organization did not have any procedures in place to monitor their subrecipients and did not secure the required annual report for any of the subrecipients tested. Cause: Prior to 2022, the Organization was unaware of this federal requirement. Effect: The Organization did not comply with subrecipient monitoring requirements relative to obtaining the annual audit reports and performing the appropriate follow-up procedures (if necessary). By not securing the required annual report of subrecipients, there is a risk that subrecipients could have instances of deficiencies or noncompliance that directly impacts the award, but the Organization is unable to respond accordingly, given it would not be aware of the issues identified. Recommendation: We recommend the Organization implement a comprehensive process (and relevant internal controls) to ensure all elements of 2 CFR Part 200, Subpart D, Section 200.332 are being met, including obtaining a copy of the subject subrecipients? annual audits and taking appropriate action on deficiencies detected through the audits. Tools, such as checklists or electronic workflows, can assist in ensuring all required elements are being met. Repeat Finding: No. Questioned Costs: None Views of Responsible Officials: There is no disagreement with the audit finding. See Corrective Action Plan prepared by the Organization.
Federal Agency: Department of Health and Human Services Federal Program: Research and Development Cluster Assistance Listing Number: 93.847 & 93.867 Federal Award Identification Number and Year: Various Award Period: January 1, 2022, through December 31, 2022 Type of Finding: Other Matters Finding related to Compliance within Uniform Guidance and Material Weakness in Internal Control Over Compliance Criteria or Specific Requirement: According to 2 CFR Part 200, Subpart D, Section 200.332, pass-through entities are required to perform certain subrecipient monitoring procedures. These procedures include providing the subrecipient necessary award information so that the federal award is used in accordance with federal regulations, evaluating risks of noncompliance of subrecipients, implementing monitoring procedures based upon identified risks, and obtaining a copy of the subrecipients? annual audit and taking appropriate action on deficiencies detected through the audits, just to name a few. Lastly, in accordance with 2 CFR Title 2, Subtitle A, Chapter 2, Part 200, Subpart D, 200.303, the non-federal entity must establish and maintain effective internal controls over the federal award to provide reasonable assurance that the non-federal entity is managing the award in compliance with federal regulations. Condition: The Organization did not verify whether the subject subrecipients received a required annual audit under 2 CFR Part 200. By not verifying and obtaining a copy of the most recent audit of the subrecipients, the Organization was unaware if any enforcement actions against noncompliant subrecipients had occurred. Context: During our testing, it was noted that the Organization did not have any procedures in place to monitor their subrecipients and did not secure the required annual report for any of the subrecipients tested. Cause: Prior to 2022, the Organization was unaware of this federal requirement. Effect: The Organization did not comply with subrecipient monitoring requirements relative to obtaining the annual audit reports and performing the appropriate follow-up procedures (if necessary). By not securing the required annual report of subrecipients, there is a risk that subrecipients could have instances of deficiencies or noncompliance that directly impacts the award, but the Organization is unable to respond accordingly, given it would not be aware of the issues identified. Recommendation: We recommend the Organization implement a comprehensive process (and relevant internal controls) to ensure all elements of 2 CFR Part 200, Subpart D, Section 200.332 are being met, including obtaining a copy of the subject subrecipients? annual audits and taking appropriate action on deficiencies detected through the audits. Tools, such as checklists or electronic workflows, can assist in ensuring all required elements are being met. Repeat Finding: No. Questioned Costs: None Views of Responsible Officials: There is no disagreement with the audit finding. See Corrective Action Plan prepared by the Organization.
Federal Agency: Department of Health and Human Services Federal Program: Research and Development Cluster Assistance Listing Number: 93.847 & 93.867 Federal Award Identification Number and Year: Various Award Period: January 1, 2022, through December 31, 2022 Type of Finding: Other Matters Finding related to Compliance within Uniform Guidance and Material Weakness in Internal Control Over Compliance Criteria or Specific Requirement: According to 2 CFR Part 200, Subpart D, Section 200.332, pass-through entities are required to perform certain subrecipient monitoring procedures. These procedures include providing the subrecipient necessary award information so that the federal award is used in accordance with federal regulations, evaluating risks of noncompliance of subrecipients, implementing monitoring procedures based upon identified risks, and obtaining a copy of the subrecipients? annual audit and taking appropriate action on deficiencies detected through the audits, just to name a few. Lastly, in accordance with 2 CFR Title 2, Subtitle A, Chapter 2, Part 200, Subpart D, 200.303, the non-federal entity must establish and maintain effective internal controls over the federal award to provide reasonable assurance that the non-federal entity is managing the award in compliance with federal regulations. Condition: The Organization did not verify whether the subject subrecipients received a required annual audit under 2 CFR Part 200. By not verifying and obtaining a copy of the most recent audit of the subrecipients, the Organization was unaware if any enforcement actions against noncompliant subrecipients had occurred. Context: During our testing, it was noted that the Organization did not have any procedures in place to monitor their subrecipients and did not secure the required annual report for any of the subrecipients tested. Cause: Prior to 2022, the Organization was unaware of this federal requirement. Effect: The Organization did not comply with subrecipient monitoring requirements relative to obtaining the annual audit reports and performing the appropriate follow-up procedures (if necessary). By not securing the required annual report of subrecipients, there is a risk that subrecipients could have instances of deficiencies or noncompliance that directly impacts the award, but the Organization is unable to respond accordingly, given it would not be aware of the issues identified. Recommendation: We recommend the Organization implement a comprehensive process (and relevant internal controls) to ensure all elements of 2 CFR Part 200, Subpart D, Section 200.332 are being met, including obtaining a copy of the subject subrecipients? annual audits and taking appropriate action on deficiencies detected through the audits. Tools, such as checklists or electronic workflows, can assist in ensuring all required elements are being met. Repeat Finding: No. Questioned Costs: None Views of Responsible Officials: There is no disagreement with the audit finding. See Corrective Action Plan prepared by the Organization.
Federal Agency: Department of Health and Human Services Federal Program: Research and Development Cluster Assistance Listing Number: 93.847 & 93.867 Federal Award Identification Number and Year: Various Award Period: January 1, 2022, through December 31, 2022 Type of Finding: Other Matters Finding related to Compliance within Uniform Guidance and Material Weakness in Internal Control Over Compliance Criteria or Specific Requirement: According to 2 CFR Part 200, Subpart D, Section 200.332, pass-through entities are required to perform certain subrecipient monitoring procedures. These procedures include providing the subrecipient necessary award information so that the federal award is used in accordance with federal regulations, evaluating risks of noncompliance of subrecipients, implementing monitoring procedures based upon identified risks, and obtaining a copy of the subrecipients? annual audit and taking appropriate action on deficiencies detected through the audits, just to name a few. Lastly, in accordance with 2 CFR Title 2, Subtitle A, Chapter 2, Part 200, Subpart D, 200.303, the non-federal entity must establish and maintain effective internal controls over the federal award to provide reasonable assurance that the non-federal entity is managing the award in compliance with federal regulations. Condition: The Organization did not verify whether the subject subrecipients received a required annual audit under 2 CFR Part 200. By not verifying and obtaining a copy of the most recent audit of the subrecipients, the Organization was unaware if any enforcement actions against noncompliant subrecipients had occurred. Context: During our testing, it was noted that the Organization did not have any procedures in place to monitor their subrecipients and did not secure the required annual report for any of the subrecipients tested. Cause: Prior to 2022, the Organization was unaware of this federal requirement. Effect: The Organization did not comply with subrecipient monitoring requirements relative to obtaining the annual audit reports and performing the appropriate follow-up procedures (if necessary). By not securing the required annual report of subrecipients, there is a risk that subrecipients could have instances of deficiencies or noncompliance that directly impacts the award, but the Organization is unable to respond accordingly, given it would not be aware of the issues identified. Recommendation: We recommend the Organization implement a comprehensive process (and relevant internal controls) to ensure all elements of 2 CFR Part 200, Subpart D, Section 200.332 are being met, including obtaining a copy of the subject subrecipients? annual audits and taking appropriate action on deficiencies detected through the audits. Tools, such as checklists or electronic workflows, can assist in ensuring all required elements are being met. Repeat Finding: No. Questioned Costs: None Views of Responsible Officials: There is no disagreement with the audit finding. See Corrective Action Plan prepared by the Organization.
Federal Agency: Department of Health and Human Services Federal Program: Research and Development Cluster Assistance Listing Number: 93.847 & 93.867 Federal Award Identification Number and Year: Various Award Period: January 1, 2022, through December 31, 2022 Type of Finding: Other Matters Finding related to Compliance within Uniform Guidance and Material Weakness in Internal Control Over Compliance Criteria or Specific Requirement: According to 2 CFR Part 200, Subpart D, Section 200.332, pass-through entities are required to perform certain subrecipient monitoring procedures. These procedures include providing the subrecipient necessary award information so that the federal award is used in accordance with federal regulations, evaluating risks of noncompliance of subrecipients, implementing monitoring procedures based upon identified risks, and obtaining a copy of the subrecipients? annual audit and taking appropriate action on deficiencies detected through the audits, just to name a few. Lastly, in accordance with 2 CFR Title 2, Subtitle A, Chapter 2, Part 200, Subpart D, 200.303, the non-federal entity must establish and maintain effective internal controls over the federal award to provide reasonable assurance that the non-federal entity is managing the award in compliance with federal regulations. Condition: The Organization did not verify whether the subject subrecipients received a required annual audit under 2 CFR Part 200. By not verifying and obtaining a copy of the most recent audit of the subrecipients, the Organization was unaware if any enforcement actions against noncompliant subrecipients had occurred. Context: During our testing, it was noted that the Organization did not have any procedures in place to monitor their subrecipients and did not secure the required annual report for any of the subrecipients tested. Cause: Prior to 2022, the Organization was unaware of this federal requirement. Effect: The Organization did not comply with subrecipient monitoring requirements relative to obtaining the annual audit reports and performing the appropriate follow-up procedures (if necessary). By not securing the required annual report of subrecipients, there is a risk that subrecipients could have instances of deficiencies or noncompliance that directly impacts the award, but the Organization is unable to respond accordingly, given it would not be aware of the issues identified. Recommendation: We recommend the Organization implement a comprehensive process (and relevant internal controls) to ensure all elements of 2 CFR Part 200, Subpart D, Section 200.332 are being met, including obtaining a copy of the subject subrecipients? annual audits and taking appropriate action on deficiencies detected through the audits. Tools, such as checklists or electronic workflows, can assist in ensuring all required elements are being met. Repeat Finding: No. Questioned Costs: None Views of Responsible Officials: There is no disagreement with the audit finding. See Corrective Action Plan prepared by the Organization.
Federal Agency: Department of Health and Human Services Federal Program: Research and Development Cluster Assistance Listing Number: 93.847 & 93.867 Federal Award Identification Number and Year: Various Award Period: January 1, 2022, through December 31, 2022 Type of Finding: Other Matters Finding related to Compliance within Uniform Guidance and Material Weakness in Internal Control Over Compliance Criteria or Specific Requirement: According to 2 CFR Part 200, Subpart D, Section 200.332, pass-through entities are required to perform certain subrecipient monitoring procedures. These procedures include providing the subrecipient necessary award information so that the federal award is used in accordance with federal regulations, evaluating risks of noncompliance of subrecipients, implementing monitoring procedures based upon identified risks, and obtaining a copy of the subrecipients? annual audit and taking appropriate action on deficiencies detected through the audits, just to name a few. Lastly, in accordance with 2 CFR Title 2, Subtitle A, Chapter 2, Part 200, Subpart D, 200.303, the non-federal entity must establish and maintain effective internal controls over the federal award to provide reasonable assurance that the non-federal entity is managing the award in compliance with federal regulations. Condition: The Organization did not verify whether the subject subrecipients received a required annual audit under 2 CFR Part 200. By not verifying and obtaining a copy of the most recent audit of the subrecipients, the Organization was unaware if any enforcement actions against noncompliant subrecipients had occurred. Context: During our testing, it was noted that the Organization did not have any procedures in place to monitor their subrecipients and did not secure the required annual report for any of the subrecipients tested. Cause: Prior to 2022, the Organization was unaware of this federal requirement. Effect: The Organization did not comply with subrecipient monitoring requirements relative to obtaining the annual audit reports and performing the appropriate follow-up procedures (if necessary). By not securing the required annual report of subrecipients, there is a risk that subrecipients could have instances of deficiencies or noncompliance that directly impacts the award, but the Organization is unable to respond accordingly, given it would not be aware of the issues identified. Recommendation: We recommend the Organization implement a comprehensive process (and relevant internal controls) to ensure all elements of 2 CFR Part 200, Subpart D, Section 200.332 are being met, including obtaining a copy of the subject subrecipients? annual audits and taking appropriate action on deficiencies detected through the audits. Tools, such as checklists or electronic workflows, can assist in ensuring all required elements are being met. Repeat Finding: No. Questioned Costs: None Views of Responsible Officials: There is no disagreement with the audit finding. See Corrective Action Plan prepared by the Organization.
Federal Agency: Department of Health and Human Services Federal Program: Research and Development Cluster Assistance Listing Number: 93.847 & 93.867 Federal Award Identification Number and Year: Various Award Period: January 1, 2022, through December 31, 2022 Type of Finding: Other Matters Finding related to Compliance within Uniform Guidance and Material Weakness in Internal Control Over Compliance Criteria or Specific Requirement: According to 2 CFR Part 200, Subpart D, Section 200.332, pass-through entities are required to perform certain subrecipient monitoring procedures. These procedures include providing the subrecipient necessary award information so that the federal award is used in accordance with federal regulations, evaluating risks of noncompliance of subrecipients, implementing monitoring procedures based upon identified risks, and obtaining a copy of the subrecipients? annual audit and taking appropriate action on deficiencies detected through the audits, just to name a few. Lastly, in accordance with 2 CFR Title 2, Subtitle A, Chapter 2, Part 200, Subpart D, 200.303, the non-federal entity must establish and maintain effective internal controls over the federal award to provide reasonable assurance that the non-federal entity is managing the award in compliance with federal regulations. Condition: The Organization did not verify whether the subject subrecipients received a required annual audit under 2 CFR Part 200. By not verifying and obtaining a copy of the most recent audit of the subrecipients, the Organization was unaware if any enforcement actions against noncompliant subrecipients had occurred. Context: During our testing, it was noted that the Organization did not have any procedures in place to monitor their subrecipients and did not secure the required annual report for any of the subrecipients tested. Cause: Prior to 2022, the Organization was unaware of this federal requirement. Effect: The Organization did not comply with subrecipient monitoring requirements relative to obtaining the annual audit reports and performing the appropriate follow-up procedures (if necessary). By not securing the required annual report of subrecipients, there is a risk that subrecipients could have instances of deficiencies or noncompliance that directly impacts the award, but the Organization is unable to respond accordingly, given it would not be aware of the issues identified. Recommendation: We recommend the Organization implement a comprehensive process (and relevant internal controls) to ensure all elements of 2 CFR Part 200, Subpart D, Section 200.332 are being met, including obtaining a copy of the subject subrecipients? annual audits and taking appropriate action on deficiencies detected through the audits. Tools, such as checklists or electronic workflows, can assist in ensuring all required elements are being met. Repeat Finding: No. Questioned Costs: None Views of Responsible Officials: There is no disagreement with the audit finding. See Corrective Action Plan prepared by the Organization.
Federal Agency: Department of Health and Human Services Federal Program: Research and Development Cluster Assistance Listing Number: 93.847 & 93.867 Federal Award Identification Number and Year: Various Award Period: January 1, 2022, through December 31, 2022 Type of Finding: Other Matters Finding related to Compliance within Uniform Guidance and Material Weakness in Internal Control Over Compliance Criteria or Specific Requirement: According to 2 CFR Part 200, Subpart D, Section 200.332, pass-through entities are required to perform certain subrecipient monitoring procedures. These procedures include providing the subrecipient necessary award information so that the federal award is used in accordance with federal regulations, evaluating risks of noncompliance of subrecipients, implementing monitoring procedures based upon identified risks, and obtaining a copy of the subrecipients? annual audit and taking appropriate action on deficiencies detected through the audits, just to name a few. Lastly, in accordance with 2 CFR Title 2, Subtitle A, Chapter 2, Part 200, Subpart D, 200.303, the non-federal entity must establish and maintain effective internal controls over the federal award to provide reasonable assurance that the non-federal entity is managing the award in compliance with federal regulations. Condition: The Organization did not verify whether the subject subrecipients received a required annual audit under 2 CFR Part 200. By not verifying and obtaining a copy of the most recent audit of the subrecipients, the Organization was unaware if any enforcement actions against noncompliant subrecipients had occurred. Context: During our testing, it was noted that the Organization did not have any procedures in place to monitor their subrecipients and did not secure the required annual report for any of the subrecipients tested. Cause: Prior to 2022, the Organization was unaware of this federal requirement. Effect: The Organization did not comply with subrecipient monitoring requirements relative to obtaining the annual audit reports and performing the appropriate follow-up procedures (if necessary). By not securing the required annual report of subrecipients, there is a risk that subrecipients could have instances of deficiencies or noncompliance that directly impacts the award, but the Organization is unable to respond accordingly, given it would not be aware of the issues identified. Recommendation: We recommend the Organization implement a comprehensive process (and relevant internal controls) to ensure all elements of 2 CFR Part 200, Subpart D, Section 200.332 are being met, including obtaining a copy of the subject subrecipients? annual audits and taking appropriate action on deficiencies detected through the audits. Tools, such as checklists or electronic workflows, can assist in ensuring all required elements are being met. Repeat Finding: No. Questioned Costs: None Views of Responsible Officials: There is no disagreement with the audit finding. See Corrective Action Plan prepared by the Organization.
Federal Agency: Department of Health and Human Services Federal Program: Research and Development Cluster Assistance Listing Number: 93.847 & 93.867 Federal Award Identification Number and Year: Various Award Period: January 1, 2022, through December 31, 2022 Type of Finding: Other Matters Finding related to Compliance within Uniform Guidance and Material Weakness in Internal Control Over Compliance Criteria or Specific Requirement: According to 2 CFR Part 200, Subpart D, Section 200.332, pass-through entities are required to perform certain subrecipient monitoring procedures. These procedures include providing the subrecipient necessary award information so that the federal award is used in accordance with federal regulations, evaluating risks of noncompliance of subrecipients, implementing monitoring procedures based upon identified risks, and obtaining a copy of the subrecipients? annual audit and taking appropriate action on deficiencies detected through the audits, just to name a few. Lastly, in accordance with 2 CFR Title 2, Subtitle A, Chapter 2, Part 200, Subpart D, 200.303, the non-federal entity must establish and maintain effective internal controls over the federal award to provide reasonable assurance that the non-federal entity is managing the award in compliance with federal regulations. Condition: The Organization did not verify whether the subject subrecipients received a required annual audit under 2 CFR Part 200. By not verifying and obtaining a copy of the most recent audit of the subrecipients, the Organization was unaware if any enforcement actions against noncompliant subrecipients had occurred. Context: During our testing, it was noted that the Organization did not have any procedures in place to monitor their subrecipients and did not secure the required annual report for any of the subrecipients tested. Cause: Prior to 2022, the Organization was unaware of this federal requirement. Effect: The Organization did not comply with subrecipient monitoring requirements relative to obtaining the annual audit reports and performing the appropriate follow-up procedures (if necessary). By not securing the required annual report of subrecipients, there is a risk that subrecipients could have instances of deficiencies or noncompliance that directly impacts the award, but the Organization is unable to respond accordingly, given it would not be aware of the issues identified. Recommendation: We recommend the Organization implement a comprehensive process (and relevant internal controls) to ensure all elements of 2 CFR Part 200, Subpart D, Section 200.332 are being met, including obtaining a copy of the subject subrecipients? annual audits and taking appropriate action on deficiencies detected through the audits. Tools, such as checklists or electronic workflows, can assist in ensuring all required elements are being met. Repeat Finding: No. Questioned Costs: None Views of Responsible Officials: There is no disagreement with the audit finding. See Corrective Action Plan prepared by the Organization.
Criteria: Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) requires that pass-through entities clearly identify to each subrecipient significant Federal subaward information, including identifying award numbers, subaward period dates and budget dates, Federal Assistance Listings number and Title, and appropriate terms and conditions concerning closeout of the subaward. Typically this requirement is satisfied by utilizing a subrecipient contract, reflecting all necessary information, and requiring execution showing acknowledgement of the terms by both parties. Condition: Internal controls should be in place to ensure the County is in compliance with all requirements of the federal award program. In place of utilizing a subrecipient contract, the County opted to attach a document of program information to its standard purchase order provided to each subrecipient engaged for the program. This document did not contain all of the information required by CFR ?200.332 to be clearly communicated to all subrecipients. Context/cause: The County did not have adequate internal controls to ensure compliance with subrecipient monitoring requirements. Testing was performed over each requirement for the County. Out of a total population of sixty (60) subrecipients, six (6) were selected for testing. For three (3) of the six (6) sampled subrecipients, the County did not clearly communicate all required subaward information. Examples of this omitted information include the date of the federal award, the subrecipient?s Unique Entity Identifier (UEI) or DUNS number, program title and assistance listing numbers, and federal award project description. Effect: Noncompliance at the subrecipient level may occur due to the subrecipient being unaware of all requirements. Questioned Costs: None. Recommendation: We recommend the County enhances internal controls to ensure compliance with subrecipient monitoring requirements.
Criteria: Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) requires that pass-through entities clearly identify to each subrecipient significant Federal subaward information, including identifying award numbers, subaward period dates and budget dates, Federal Assistance Listings number and Title, and appropriate terms and conditions concerning closeout of the subaward. Typically this requirement is satisfied by utilizing a subrecipient contract, reflecting all necessary information, and requiring execution showing acknowledgement of the terms by both parties. Condition: Internal controls should be in place to ensure the County is in compliance with all requirements of the federal award program. In place of utilizing a subrecipient contract, the County opted to attach a document of program information to its standard purchase order provided to each subrecipient engaged for the program. This document did not contain all of the information required by CFR ?200.332 to be clearly communicated to all subrecipients. Context/cause: The County did not have adequate internal controls to ensure compliance with subrecipient monitoring requirements. Testing was performed over each requirement for the County. Out of a total population of sixty (60) subrecipients, six (6) were selected for testing. For three (3) of the six (6) sampled subrecipients, the County did not clearly communicate all required subaward information. Examples of this omitted information include the date of the federal award, the subrecipient?s Unique Entity Identifier (UEI) or DUNS number, program title and assistance listing numbers, and federal award project description. Effect: Noncompliance at the subrecipient level may occur due to the subrecipient being unaware of all requirements. Questioned Costs: None. Recommendation: We recommend the County enhances internal controls to ensure compliance with subrecipient monitoring requirements.
2022-001 ? Subrecipient Monitoring Cluster: Research and Development Agency: Department of Commerce and Department of Health and Human Services Award Names: Standards/Guidance for Rapid Qualification of Metal-Based Additive Manufacturing and Development and Testing a Field-based Hazard/Near-Miss Sharing System for Commercial Fishing Vessels Award Numbers: 70NANB21H038 and U01OH012288 Assistance Listing Title: Measurement and Engineering Research and Standards and Occupational Safety and Health Program Assistance Listing Number: 11.609 and 93.262 Award Year: FY 2022 Criteria 2 CFR 200.332(d) notes that pass-through entity monitoring of the subrecipient must include: 1. Reviewing financial and performance reports required by the pass-through entity. 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 2 CFR 200.521. 2 CFR 200.332(f) notes that a pass-through entity must verify that every subrecipient is audited as required by the Uniform Guidance when it is expected that the subrecipient?s Federal awards expended during the respective fiscal year equaled or exceeded the threshold set forth in 2 CFR 200.501. Condition Through our testing of 4 subrecipients out of a population of 10, we were able to obtain a documented initial risk assessment for each subrecipient selected and other evidence of monitoring such as meetings with the subrecipients. However, we were unable to obtain evidence that the Company obtained and reviewed the annual Uniform Guidance report or annual audited financial statements (if the entity was not subject to a Uniform Guidance audit) for each subrecipient selected for testing. Cause The Company performed an initial risk assessment but did not understand that obtaining the Uniform Guidance reports or financial statements needed to be completed annually as part of their subrecipient monitoring procedures. Effect The lack of an annual review of subrecipient audits may result in ineligible subrecipients receiving federal awards, subrecipient findings not being fully remediated and other monitoring procedures (based on risk level) not being performed. Questioned Costs None noted. Recommendation We recommend the Company implement a policy to review Uniform Guidance reports (or audited financial statements to the extent Uniform Guidance reports are not available) on an annual basis. When reviewing the reports, they should understand the type of opinion(s) expressed and whether there were any findings associated with their awards, document their review and assess whether there is any change in the risk assessment and subsequent monitoring needed of each subrecipient. Management? Views and Corrective Action Plan Management?s Views and Corrective Action Plan are included at the end of this report.
2022-001 ? Subrecipient Monitoring Cluster: Research and Development Agency: Department of Commerce and Department of Health and Human Services Award Names: Standards/Guidance for Rapid Qualification of Metal-Based Additive Manufacturing and Development and Testing a Field-based Hazard/Near-Miss Sharing System for Commercial Fishing Vessels Award Numbers: 70NANB21H038 and U01OH012288 Assistance Listing Title: Measurement and Engineering Research and Standards and Occupational Safety and Health Program Assistance Listing Number: 11.609 and 93.262 Award Year: FY 2022 Criteria 2 CFR 200.332(d) notes that pass-through entity monitoring of the subrecipient must include: 1. Reviewing financial and performance reports required by the pass-through entity. 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 2 CFR 200.521. 2 CFR 200.332(f) notes that a pass-through entity must verify that every subrecipient is audited as required by the Uniform Guidance when it is expected that the subrecipient?s Federal awards expended during the respective fiscal year equaled or exceeded the threshold set forth in 2 CFR 200.501. Condition Through our testing of 4 subrecipients out of a population of 10, we were able to obtain a documented initial risk assessment for each subrecipient selected and other evidence of monitoring such as meetings with the subrecipients. However, we were unable to obtain evidence that the Company obtained and reviewed the annual Uniform Guidance report or annual audited financial statements (if the entity was not subject to a Uniform Guidance audit) for each subrecipient selected for testing. Cause The Company performed an initial risk assessment but did not understand that obtaining the Uniform Guidance reports or financial statements needed to be completed annually as part of their subrecipient monitoring procedures. Effect The lack of an annual review of subrecipient audits may result in ineligible subrecipients receiving federal awards, subrecipient findings not being fully remediated and other monitoring procedures (based on risk level) not being performed. Questioned Costs None noted. Recommendation We recommend the Company implement a policy to review Uniform Guidance reports (or audited financial statements to the extent Uniform Guidance reports are not available) on an annual basis. When reviewing the reports, they should understand the type of opinion(s) expressed and whether there were any findings associated with their awards, document their review and assess whether there is any change in the risk assessment and subsequent monitoring needed of each subrecipient. Management? Views and Corrective Action Plan Management?s Views and Corrective Action Plan are included at the end of this report.
Repeat of Prior Audit Finding 2021-005 Federal Program: Trans-National Crime Federal Agencies: United States Department of State- United States Bureau of International Narcotics and Law Enforcement Affairs Federal Assistance Listing Number: 19.705 Federal Award Year: December 31, 2022 Criteria: 2 CFR Part 200, Subpart D Section 200.332 of the Uniform Guidance require all non-Federal entities to assess subrecipients' risk, as well as monitor sub-awards passed through. All requirements imposed by the pass-through entity on the subrecipient are to ensure that the Federal award is used in accordance with Federal statutes, regulations and the terms and conditions of the Federal award. Condition/Context: For the selection of 2 subrecipients, we were unable to verify that the respective subaward agreements contained accurate award information, such as the identification of the funding being U.S. federal funds, the federal Assistance Listing Number and the requirements that the subrecipients would need to comply with the Uniform Guidance. In addition, for 2 other subrecipients, we could not determine the quarterly programmatic and financial reports were reviewed or approved by Panthera Corporation as there was no evidence of formal review and approval. There was also no evidence that those subrecipients had been audited or monitored under appropriate local government regulations. This was not a statistically valid sample. Questioned Costs: Not determinable Cause: Panthera Corporation's procedures did not ensure the required written subrecipient monitoring policies were implemented in accordance with the Uniform Guidance. Effect: Panthera Corporation's control design and operation does not provide reasonable assurance that Panthera Corporation is managing the subrecipient monitoring requirements of the Uniform Guidance. Recommendation: We recommend that Panthera Corporation clearly identify in each agreement with subrecipients the reference to the applicable federal Assistance Listing Number and request audited reports from subrecipients when applicable. We further recommend that Panthera Corporation follow its policies and procedures by ensuring that subrecipient quarterly reports are subject to the appropriate process as well as maintaining documentation to allow for an audit trail. View of Responsible Officials: Management acknowledges the finding and will be retaining support and updating subrecipient agreements to include the relevant award information and the Uniform Guidance compliance requirements for subrecipients.
Please see table on page 16 of the Single Audit.Finding 2022-001 ? Subrecipient Monitoring Condition: The County did not have a documented risk assessment process for evaluating subrecipient?s risk of non-compliance. Additionally, as part of the monitoring process, the County did not have controls in place to obtain and review the annual audit reports of all subrecipients in a timely manner with documentation of such review. Criteria: The Pennsylvania Department of Human Services (PA DHS) and 2 CFR section 200.332(b) requires pass-through entities to evaluate subrecipient risks of noncompliance as part of their subrecipient monitoring procedures. In addition, 2 CFR section 200.332(d) indicates as part of the monitoring process, the pass-through entity should ensure subrecipients take follow-up action on audit deficiencies, which would be identified as part of the review of the annual audit reports of subrecipients. Cause: There were no procedures in place to document the County?s assessment of risk for subrecipients. In addition, the County does not have procedures in place to adequately review the subrecipient audits received. Effect: The deficiencies in subrecipient monitoring could result in the County not identifying unallowable expenses being incurred by County subrecipients. Repeat Finding: This is not a repeat finding. Recommendation: We recommend implementation of procedures to formally document and complete a risk assessment of subrecipients. Based on the risk assessment performed, the County should develop monitoring procedures to address the risks noted, which should include a documented review of subrecipient audits and deficiencies be followed up on, if applicable. Questioned Costs: Unknown Views of Responsible Official and Planned Corrective Action: Management agrees with the finding. See separate correction action plan.
2022 ? 003 Federal Agency: Department of Health and Human Services Federal Program Name: Immunization Research, Demonstration, Public Information and Education, Training and Clinical Skills Improvement Projects Assistance Listing Number: 93.185 Pass-Through Agency: Michigan State University Award Period: July 31, 2021 ? July 30, 2023 Type of Finding: ? Material Weakness in Internal Control over Compliance ? Other Matters Criteria or specific requirement: 2 CFR 200.332(f) requires that the pass through entity verify that subrecipients expected to be audited as required by 2 CFR Part 200, Subpart F, met this requirement. This verification may be performed as part of the required monitoring under 2 CFR section 200.332(d)(2) to ensure that the subrecipient takes timely and appropriate action on deficiencies detected though audits. Condition: Annual audit reports of subrecipients were not obtained or reviewed by the Foundation. Questioned costs: None Context: Three of the five subrecipients tested were required to have an annual audit report, but these were not obtained or reviewed by the Foundation. Cause: Management was not aware of this requirement. Effect: The subrecipient may have deficiencies detected though audits that could impact monitoring by the Foundation. Recommendation: We recommend the Foundation attend training, review federal requirements, and fully understand the requirements of subrecipient monitoring. Views of responsible officials: There is no disagreement with the audit finding. See the Corrective Action Plan for further details.
Criteria: Monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, complies with the terms and conditions of the subaward, and achieves performance goals (2 CFR sections 200.332(d) through (f)). Following-up and ensuring that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the federal award provided to the subrecipient detected through audits, on-site reviews, and other means. Condition/Context: For five of the five providers monitored during the program?s fiscal year, the County Child and Youth Services department?s results and findings were communicated to the providers at the conclusion of the review procedures, however providers did not submit a written corrective action plan. Cause: Providers on-site monitoring was completed and the results were communicated to the providers in writing. Notice that a corrective action plan was needed in response was not given to the providers. Effect: Lack of written corrective action plan limits the County Child and Youth Services department?s ability to monitor that the providers takes timely and appropriate action to address deficiencies pertaining to the federal award. Questioned Costs: There are no questioned costs associated with this finding. This is not a statistically valid sample. Recommendation: Providers that receive findings as a result of their on-site monitoring should submit a corrective action plan to the County. Views of Responsible Officials and Planned Corrective Actions: The County Child and Youth Services department will require a corrective action plan for all subrecipients with findings as a result of their on-site monitoring in 2023, and thereafter, that will include the entity?s plan to correct the errors noted, individual responsible and timeline for corrections to be implemented.
Criteria: Monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, complies with the terms and conditions of the subaward, and achieves performance goals (2 CFR sections 200.332(d) through (f)). Following-up and ensuring that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the federal award provided to the subrecipient detected through audits, on-site reviews, and other means. Condition/Context: For five of the five providers monitored during the program?s fiscal year, the County Child and Youth Services department?s results and findings were communicated to the providers at the conclusion of the review procedures, however providers did not submit a written corrective action plan. Cause: Providers on-site monitoring was completed and the results were communicated to the providers in writing. Notice that a corrective action plan was needed in response was not given to the providers. Effect: Lack of written corrective action plan limits the County Child and Youth Services department?s ability to monitor that the providers takes timely and appropriate action to address deficiencies pertaining to the federal award. Questioned Costs: There are no questioned costs associated with this finding. This is not a statistically valid sample. Recommendation: Providers that receive findings as a result of their on-site monitoring should submit a corrective action plan to the County. Views of Responsible Officials and Planned Corrective Actions: The County Child and Youth Services department will require a corrective action plan for all subrecipients with findings as a result of their on-site monitoring in 2023, and thereafter, that will include the entity?s plan to correct the errors noted, individual responsible and timeline for corrections to be implemented.
Criteria or Specific Requirements: Using the guidance in 2 CFR section 200.331, non-Federal entities passing federal awards through to other entities are required to perform a determination as to whether the other entities are considered to be subrecipients or contractors. Under 2 CFR 200.332, pass-through entities are required to ensure that subawards to subrecipients include required federal award identification and detail of all compliance and other requirements for the federal award. In addition, the subrecipients to ensure that the subaward is used for authorized purposes, that compliance requirements are met, and that the subrecipient takes timely and appropriate action on any deficiencies relating to the Federal award provided. Condition: During testing over subrecipients monitoring and reporting, we noted the County did not have effective control over subrecipient monitoring and reporting. Questioned costs: None. Context: For 5 of 5 subrecipients selected, the County did not have agreements with the subrecipients that included the required federal award information and did not have a process in place to monitor these subrecipients. Prior to 2022, the County determined that certain entities receiving payment under TANF were contractors. In March of 2023, the County performed a revised analysis using the guidance in 2 CFR 200.331 with the conclusion that certain entities that were previously determined to be contractors should have been considered subrecipients. After this revised determination was made, the County did not provide revised subaward agreements or perform subrecipients monitoring procedures. Cause: The County initially improperly determined TANF subrecipients as contractors prior to 2022 and did not follow up timely after a revised determination was completed in 2023. The County did not have a process in place to properly assess if organizations met the criteria to be considered subrecipients. Effect: If the County does not provide required subaward information on a timely basis, it increases the risk that subrecipients will not be in compliance with all required federal award requirements. Repeat Finding: Not a repeat finding. Recommendation: We recommend the County determine whether an entity receiving payment under TANF is a subrecipient or a contractor prior to entering into an agreement with the entity and to include all guidance under 2 CFR 200.331 when making this determination. Views of responsible officials: There is no disagreement with the audit findings.
Criteria or specific requirement: Per 2 CFR 200.331(a) states that all pass-through entities must ensure that every subaward is clearly identified to the subrecipient as a subaward and includes the following information at the time of the subaward and if any of these data elements change, include the changes in subsequent subaward modification. When some of this information is not available, the pass-through entity must provide the best information available to describe the Federal award and subaward. Required information includes, federal award identification, subrecipient name, subrecipient?s DUNS number, federal award identification number (FAIN), federal award date, subaward start and end date, amount of federal funds obligated, total amount of federal award, federal award project description, name of federal awarding agency, Assistance Listing (CFDA) number and name, identification of whether the award is R&D and indirect cost rate for federal award. Per 2 CFR 200.303, requires that non-federal entities receiving federal awards establish and maintain internal control designed to reasonably ensure compliance with federal statutes, regulations, and the terms and conditions of the federal award. Effective internal control should include procedures to ensure required information is communicated prior to the issuance of the subaward. Per 2 CFR 200.331(a)(1), pass-through entities must evaluate each subrecipient?s risk of noncompliance to determine the appropriate level of monitoring of the subrecipient. Per 2 CFR 200.332(d) through (f), pass-through entities must monitor the activities of the subrecipient, which includes reviewing financial reports required by the pass-through entity. Condition: During our testing, we noted subrecipients tested had required information omitted from the sub agreements to the subrecipients including Assistance Listing (CFDA) title and number, subrecipient?s DUNS number, Federal Award Identification Number (FAIN), identification of whether the award is research and development, and indirect cost rate for federal award. Subrecipients tested did not have evidence of the County?s evaluation of the risk of noncompliance by the subrecipients, nor was there evidence of monitoring of annual audits for the subrecipients. Internal checklists that aid in compliance were missing for certain subrecipients. A subrecipient was provided the funding at the beginning of the grant award period and no required quarterly reports were submitted to the County subsequent to funding. Questioned costs: None. Context: Five out of the five subrecipients did not include required information in subaward agreements issued to subrecipients and lacked evidence of both the evaluation of risk of noncompliance of the subrecipient and monitoring of annual audits for the subrecipients. Two of the five subrecipients were missing an internal checklist that is signed by the County Manager. One of the five subrecipients was provided the funding at the beginning of the grant award period and no required quarterly reports were submitted to the County subsequent to funding. Cause: Lack of sufficient controls in place to ensure that subrecipient agreements contain all required information and are monitored appropriately. Effect: Failure to communicate required information and to adequately monitor the subrecipients could result in subrecipients not properly administering the federal programs in accordance with federal regulations. Repeat Finding: No. Recommendation: We recommend that the County review its procedures for communicating information to subrecipients and implement the procedures necessary to ensure information is included in the subrecipient award documents at time of funding and that appropriate monitoring is performed for each subrecipient. Views of responsible officials: There is no disagreement with the audit finding.
Criteria or specific requirement: Per 2 CFR 200.331(a) states that all pass-through entities must ensure that every subaward is clearly identified to the subrecipient as a subaward and includes the following information at the time of the subaward and if any of these data elements change, include the changes in subsequent subaward modification. When some of this information is not available, the pass-through entity must provide the best information available to describe the Federal award and subaward. Required information includes, federal award identification, subrecipient name, subrecipient?s DUNS number, federal award identification number (FAIN), federal award date, subaward start and end date, amount of federal funds obligated, total amount of federal award, federal award project description, name of federal awarding agency, Assistance Listing (CFDA) number and name, identification of whether the award is R&D and indirect cost rate for federal award. Per 2 CFR 200.303, requires that non-federal entities receiving federal awards establish and maintain internal control designed to reasonably ensure compliance with federal statutes, regulations, and the terms and conditions of the federal award. Effective internal control should include procedures to ensure required information is communicated prior to the issuance of the subaward. Per 2 CFR 200.331(a)(1), pass-through entities must evaluate each subrecipient?s risk of noncompliance to determine the appropriate level of monitoring of the subrecipient. Per 2 CFR 200.332(d) through (f), pass-through entities must monitor the activities of the subrecipient, which includes reviewing financial reports required by the pass-through entity. Condition: During our testing, we noted subrecipients tested had required information omitted from the sub agreements to the subrecipients including Assistance Listing (CFDA) title and number, subrecipient?s DUNS number, Federal Award Identification Number (FAIN), identification of whether the award is research and development, and indirect cost rate for federal award. Subrecipients tested did not have evidence of the County?s evaluation of the risk of noncompliance by the subrecipients, nor was there evidence of monitoring of annual audits for the subrecipients. Internal checklists that aid in compliance were missing for certain subrecipients. A subrecipient was provided the funding at the beginning of the grant award period and no required quarterly reports were submitted to the County subsequent to funding. Questioned costs: None. Context: Five out of the five subrecipients did not include required information in subaward agreements issued to subrecipients and lacked evidence of both the evaluation of risk of noncompliance of the subrecipient and monitoring of annual audits for the subrecipients. Two of the five subrecipients were missing an internal checklist that is signed by the County Manager. One of the five subrecipients was provided the funding at the beginning of the grant award period and no required quarterly reports were submitted to the County subsequent to funding. Cause: Lack of sufficient controls in place to ensure that subrecipient agreements contain all required information and are monitored appropriately. Effect: Failure to communicate required information and to adequately monitor the subrecipients could result in subrecipients not properly administering the federal programs in accordance with federal regulations. Repeat Finding: No. Recommendation: We recommend that the County review its procedures for communicating information to subrecipients and implement the procedures necessary to ensure information is included in the subrecipient award documents at time of funding and that appropriate monitoring is performed for each subrecipient. Views of responsible officials: There is no disagreement with the audit finding.
Criteria or specific requirement: Per 2 CFR 200.331(a) states that all pass-through entities must ensure that every subaward is clearly identified to the subrecipient as a subaward and includes the following information at the time of the subaward and if any of these data elements change, include the changes in subsequent subaward modification. When some of this information is not available, the pass-through entity must provide the best information available to describe the Federal award and subaward. Required information includes, federal award identification, subrecipient name, subrecipient?s DUNS number, federal award identification number (FAIN), federal award date, subaward start and end date, amount of federal funds obligated, total amount of federal award, federal award project description, name of federal awarding agency, Assistance Listing (CFDA) number and name, identification of whether the award is R&D and indirect cost rate for federal award. Per 2 CFR 200.303, requires that non-federal entities receiving federal awards establish and maintain internal control designed to reasonably ensure compliance with federal statutes, regulations, and the terms and conditions of the federal award. Effective internal control should include procedures to ensure required information is communicated prior to the issuance of the subaward. Per 2 CFR 200.331(a)(1), pass-through entities must evaluate each subrecipient?s risk of noncompliance to determine the appropriate level of monitoring of the subrecipient. Per 2 CFR 200.332(d) through (f), pass-through entities must monitor the activities of the subrecipient, which includes reviewing financial reports required by the pass-through entity. Condition: During our testing, we noted subrecipients tested had required information omitted from the sub agreements to the subrecipients including Assistance Listing (CFDA) title and number, subrecipient?s DUNS number, Federal Award Identification Number (FAIN), identification of whether the award is research and development, and indirect cost rate for federal award. Subrecipients tested did not have evidence of the County?s evaluation of the risk of noncompliance by the subrecipients, nor was there evidence of monitoring of annual audits for the subrecipients. Internal checklists that aid in compliance were missing for certain subrecipients. A subrecipient was provided the funding at the beginning of the grant award period and no required quarterly reports were submitted to the County subsequent to funding. Questioned costs: None. Context: Five out of the five subrecipients did not include required information in subaward agreements issued to subrecipients and lacked evidence of both the evaluation of risk of noncompliance of the subrecipient and monitoring of annual audits for the subrecipients. Two of the five subrecipients were missing an internal checklist that is signed by the County Manager. One of the five subrecipients was provided the funding at the beginning of the grant award period and no required quarterly reports were submitted to the County subsequent to funding. Cause: Lack of sufficient controls in place to ensure that subrecipient agreements contain all required information and are monitored appropriately. Effect: Failure to communicate required information and to adequately monitor the subrecipients could result in subrecipients not properly administering the federal programs in accordance with federal regulations. Repeat Finding: No. Recommendation: We recommend that the County review its procedures for communicating information to subrecipients and implement the procedures necessary to ensure information is included in the subrecipient award documents at time of funding and that appropriate monitoring is performed for each subrecipient. Views of responsible officials: There is no disagreement with the audit finding.
Finding 2022-001 ? M. Subrecipient Monitoring Identification of the Federal Program: Grantor: Department of Health and Human Services Program Name: Research and Development Cluster Assistance Listing No. / FAIN: 93.847 / R24DK106743 Criteria or Specific Requirement: M. Subrecipient Monitoring ? A pass-through entity must evaluate each subrecipient?s risk of noncompliance for purposes of determining the appropriate subrecipient monitoring related to the subaward (2 CFR section 200.332(b)). Condition: Management should establish and implement a policy which addresses the requirement identified above, including evaluating the results of previous audits obtained by its subrecipients including whether or not the subrecipient receives a single audit in accordance with 2 CFR part 200, subpart F, and the extent to which the same or similar subaward has been audited as a major program. Cause: Management implemented updated policies related to subrecipient monitoring during 2022; however, such policies were not in effect for the full calendar year. Effect or Potential Effect: The lack of an effective control over subrecipient monitoring resulted in instances of noncompliance identified. Questioned Costs: Not applicable. Context: In a sample of two subrecipients within the Research and Development Cluster, two instances of noncompliance were identified where it could not be ascertained that the Institute verified that subrecipients have been audited as required by 2 CFR part 200, subpart F, as Institute management did not evaluate the subrecipients? compliance. Identification as a repeat finding: This finding was reported as finding 2021-001 in the prior year. Recommendation: Management has implemented a policy over subrecipient monitoring during 2022. Management should therefore perform an annual review of Uniform Guidance grant compliance audit reports of subrecipients on an annual basis to identify and evaluate the subrecipients? risk of noncompliance for purposes of determining the appropriate subrecipient monitoring. Views of Responsible Officials: Management concurs with this audit finding. During 2022, management implemented an annual review control whereby the reports will be reviewed to ensure compliance with federal agency requirements.
FINDING 2022-003 Program Information: COVID-19 Governor?s Emergency Education Relief Fund (84.425C) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): Federal Compliance Requirement: M. Subrecipient Monitoring - The pass-through entity must monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, complies with the terms and conditions of the subaward, and achieves performance goals (2 CFR sections 200.332(d) through (f)). The State of Georgia stipulates GEER II Funds may not be used for administrative or executive salaries or benefits, or for any purpose not permitted under Section 312 of the CRRSAA. Condition: The Organization did not have sufficient monitoring processes in place to detect unallowable personnel costs charged to the GEER grant. The Organization did not maintain sufficient audit evidence for subrecipient payroll charges under the grant. Cause: Lack of administrative oversight with respect to subrecipient monitoring requirements. Effect or Potential Effect: The Organization was not in compliance with subrecipient monitoring requirements. Questioned Costs: $48,121 Context: We noted the following exceptions: For 11 of 51 monthly invoices selected for testing, the Organization did not properly identify unallowable personnel costs charged to the grant. For 17 of 51 monthly invoices selected for testing, the Organization did not properly verify hours charged to the grant by club employees. Identification as a Repeat Finding: No similar findings noted in the prior year. Recommendation: We recommend that the Organization enhance its policies and procedures over subrecipient monitoring to properly detect and prevent unallowable charges to the grant as well as maintain sufficient audit evidence for all grant expenditures. Views of Responsible Officials and Planned Corrective Actions: Management will update subrecipient monitoring procedures to ensure compliance with subrecipient monitoring requirements and will continue to follow these enhanced policies to properly detect and prevent unallowable charges to the grant. Management will implement monitoring processes to ensure subrecipients submit sufficient documentation prior to disbursing funds.
Criteria: Under the Uniform Guidance, pass-through entities must ensure that every subaward is clearly identified to the subrecipient as a subaward and includes specific information identifying the federal award at the time of the subaward (2 CFR 200.332(a)). Additionally, entities receiving federal awards must establish and maintain effective internal control over federal awards that provides reasonable assurance that the entity is managing the awards in compliance with federal statutes, regulations, and the terms and conditions of the awards (2 CFR 200.303(a)). Condition: Subaward agreements did not include certain required information such as the name and assistance listing number of the original federal award. Questioned Costs: Unknown Cause: Staff members at Seattle Good Business Network were not aware of the requirements for amounts passed through to subrecipients. Context: Seattle Good Business Network has not previously received significant federal awards and did not have adequate internal controls established to ensure all required communications were made to subrecipients. Effect: Failure to notify subrecipients of federal award information may result in subrecipients not properly administering the Coronavirus State and Local Fiscal Recovery Funds program in accordance with statutes, regulations, and the terms and conditions of the award. Recommendation: We recommend that Seattle Good Business Network updates its standard subaward agreements to include all required federal award information and implements policies and procedures to ensure staff are informed of all federal award compliance requirements. Views of Responsible Officials: There is no disagreement with the finding. See the attached unaudited corrective action plan.
Finding 2022-004: Internal Controls over Compliance and Other Matters M. Subrecipient Monitoring U.S. DEPARTMENT OF JUSTICE Children Exposed to Violence ? Assistance Listing No. 16.818 U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES COVID-19 ? Community Services Block Grant? Assistance Listing No. 93.569 Criteria: The Uniform Guidance requires program participants who are pass-through entities to monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, complies with the terms and conditions of the subaward, and achieves performance goals (2 CFR sections 200.331(d) through (f)). All pass-through entities must also ensure that every subaward is clearly identified to the subrecipient as a subaward and includes the following specific required information: federal award identification information, all requirements imposed by the pass-through entity, any additional requirements to meet the pass-through entity?s responsibilities, information on the indirect cost rate, requirements to permit access to subrecipients? records and statements, and appropriate closeout terms and conditions (2 CFR section 200.332). Condition: The U.S. Department of Justice?s (DOJ) EDPR of Youthprise?s Children Exposed to Violence Program (re. 2020-CV-FX-K007) noted compliance issues over Youthprise?s subrecipient monitoring. Deficiencies included the budget, risk assessments, determination of suitability, lobbying forms, and missing documentation as it related to its subrecipient grants. A formal letter was issued to Youthprise dated November 8, 2022, detailing the compliance issues noted. In addition, the subgrant agreements awarded for the COVID-19 ? Community Services Block Grant program did not include the required information per 2 CFR section 200.332. Cause: Internal controls were not in place to ensure Youthprise followed the subrecipient monitoring requirements outlined in 2 CFR section 200.331 and 200.332. Effect: The conditions noted above resulted in noncompliance over subrecipient monitoring by Youthprise. Context: The DOJ completed a EDPR of Youthprise?s Children Exposed to Violence Program (re. 2020-CV-FX-K007) during 2022. The DOJ outlined specific recommendations in its EPDR letter dated November 22, 2022 to address the conditions noted above and requested resolution to the conditions noted in its EPDR within 20 calendar days. DOJ completed a follow-up site visit at Youthprise on July 10, 2023 and determined all compliance issues to have been adequately resolved. The original agreement from Community Action Partnership of Hennepin County for the COVID-19 ? Community Services Block Grant program did not specify that Youthprise was considered a subrecipient of these federal funds, nor did it contain the required information under 2 CFR section 200.332. Youthprise originally considered themselves a contractor under the agreement and therefore the required subaward information per 2 CFR section 200.332 was not included in the subgrant agreements. Subsequently, it was verified with the pass-through entity that Youthprise is considered a subrecipient for this program. Questioned Costs: $0 Identification of Repeat Finding: Not a repeat finding. Recommendation: We recommend that Youthprise review procedures to ensure adequate subrecipient monitoring is being performed over all subrecipient agreements, that meet the requirements of 2 CFR 200.331 and 2 CFR 200.332. Views of Responsible Officials and Corrective Action Plan: Management agrees with this finding and is in the process of developing internal controls to ensure timely and appropriate actions are made on the deficiency noted. Additional details can be found in Youthprise?s Corrective Action Plan.
Finding 2022-004: Internal Controls over Compliance and Other Matters M. Subrecipient Monitoring U.S. DEPARTMENT OF JUSTICE Children Exposed to Violence ? Assistance Listing No. 16.818 U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES COVID-19 ? Community Services Block Grant? Assistance Listing No. 93.569 Criteria: The Uniform Guidance requires program participants who are pass-through entities to monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, complies with the terms and conditions of the subaward, and achieves performance goals (2 CFR sections 200.331(d) through (f)). All pass-through entities must also ensure that every subaward is clearly identified to the subrecipient as a subaward and includes the following specific required information: federal award identification information, all requirements imposed by the pass-through entity, any additional requirements to meet the pass-through entity?s responsibilities, information on the indirect cost rate, requirements to permit access to subrecipients? records and statements, and appropriate closeout terms and conditions (2 CFR section 200.332). Condition: The U.S. Department of Justice?s (DOJ) EDPR of Youthprise?s Children Exposed to Violence Program (re. 2020-CV-FX-K007) noted compliance issues over Youthprise?s subrecipient monitoring. Deficiencies included the budget, risk assessments, determination of suitability, lobbying forms, and missing documentation as it related to its subrecipient grants. A formal letter was issued to Youthprise dated November 8, 2022, detailing the compliance issues noted. In addition, the subgrant agreements awarded for the COVID-19 ? Community Services Block Grant program did not include the required information per 2 CFR section 200.332. Cause: Internal controls were not in place to ensure Youthprise followed the subrecipient monitoring requirements outlined in 2 CFR section 200.331 and 200.332. Effect: The conditions noted above resulted in noncompliance over subrecipient monitoring by Youthprise. Context: The DOJ completed a EDPR of Youthprise?s Children Exposed to Violence Program (re. 2020-CV-FX-K007) during 2022. The DOJ outlined specific recommendations in its EPDR letter dated November 22, 2022 to address the conditions noted above and requested resolution to the conditions noted in its EPDR within 20 calendar days. DOJ completed a follow-up site visit at Youthprise on July 10, 2023 and determined all compliance issues to have been adequately resolved. The original agreement from Community Action Partnership of Hennepin County for the COVID-19 ? Community Services Block Grant program did not specify that Youthprise was considered a subrecipient of these federal funds, nor did it contain the required information under 2 CFR section 200.332. Youthprise originally considered themselves a contractor under the agreement and therefore the required subaward information per 2 CFR section 200.332 was not included in the subgrant agreements. Subsequently, it was verified with the pass-through entity that Youthprise is considered a subrecipient for this program. Questioned Costs: $0 Identification of Repeat Finding: Not a repeat finding. Recommendation: We recommend that Youthprise review procedures to ensure adequate subrecipient monitoring is being performed over all subrecipient agreements, that meet the requirements of 2 CFR 200.331 and 2 CFR 200.332. Views of Responsible Officials and Corrective Action Plan: Management agrees with this finding and is in the process of developing internal controls to ensure timely and appropriate actions are made on the deficiency noted. Additional details can be found in Youthprise?s Corrective Action Plan.
Finding 2022-002 ? Subrecipient Monitoring Department of Health and Human Services Passed through Pennsylvania Department of Human Services Foster Care ? Title IV-E ? ALN 93.658 Subrecipient Monitoring Condition: The County appropriately notified the subrecipients of the federal award identification and performed a risk assessment; however, the County did not monitor ten of the twelve subrecipients during the year to ensure compliance with federal statutes, regulations, and the terms and conditions of the subaward. Criteria: The Pennsylvania Department of Human Services (PA DHS) and 2 CFR section 200.332 require pass-through entities to ensure that the award is clearly identified to the subrecipient as a subaward and includes information at the time of the subaward regarding federal award identification, all requirements imposed by the pass-through entity on the subrecipient so that the federal award is used in accordance with federal statutes and the terms and conditions of the federal award, any additional requirements that the pass-through entity imposes on the subrecipient, and a requirement that the subrecipient permit the pass-through entity and auditors to have access to the subrecipient?s records and financial statements as necessary. Additionally, the pass-through entity is required to evaluate each subrecipient?s risk of noncompliance, monitoring 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 verify that every subrecipient is audited as required by Subpart F, as necessary. It is the County?s policy, as part of the monitoring process, that each subrecipient of these federal awards be monitored annually. Cause: The County has established formal subrecipient monitoring policies. However, due to staffing issues, the County?s internal control process over subrecipient monitoring was not effective. Effect: A failure to monitor subrecipients? compliance with relevant federal requirements could result in noncompliance with the terms and conditions of the subawards. Questioned Costs: Unknown. Identification as a Repeat Finding: This is not a repeat finding from the prior audit. Recommendation: We recommend that the County ensure adherence to the monitoring policy related to subrecipients and that these subrecipients be monitored on an annual basis in accordance with the policy. Management?s Response: Management agrees with this finding. See separate Corrective Action Plan.
Finding 2022-002 ? Subrecipient Monitoring Department of Health and Human Services Passed through Pennsylvania Department of Human Services Foster Care ? Title IV-E ? ALN 93.658 Subrecipient Monitoring Condition: The County appropriately notified the subrecipients of the federal award identification and performed a risk assessment; however, the County did not monitor ten of the twelve subrecipients during the year to ensure compliance with federal statutes, regulations, and the terms and conditions of the subaward. Criteria: The Pennsylvania Department of Human Services (PA DHS) and 2 CFR section 200.332 require pass-through entities to ensure that the award is clearly identified to the subrecipient as a subaward and includes information at the time of the subaward regarding federal award identification, all requirements imposed by the pass-through entity on the subrecipient so that the federal award is used in accordance with federal statutes and the terms and conditions of the federal award, any additional requirements that the pass-through entity imposes on the subrecipient, and a requirement that the subrecipient permit the pass-through entity and auditors to have access to the subrecipient?s records and financial statements as necessary. Additionally, the pass-through entity is required to evaluate each subrecipient?s risk of noncompliance, monitoring 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 verify that every subrecipient is audited as required by Subpart F, as necessary. It is the County?s policy, as part of the monitoring process, that each subrecipient of these federal awards be monitored annually. Cause: The County has established formal subrecipient monitoring policies. However, due to staffing issues, the County?s internal control process over subrecipient monitoring was not effective. Effect: A failure to monitor subrecipients? compliance with relevant federal requirements could result in noncompliance with the terms and conditions of the subawards. Questioned Costs: Unknown. Identification as a Repeat Finding: This is not a repeat finding from the prior audit. Recommendation: We recommend that the County ensure adherence to the monitoring policy related to subrecipients and that these subrecipients be monitored on an annual basis in accordance with the policy. Management?s Response: Management agrees with this finding. See separate Corrective Action Plan.
Finding 2022-002 ? Subrecipient Monitoring Department of Health and Human Services Passed through Pennsylvania Department of Human Services Foster Care ? Title IV-E ? ALN 93.658 Subrecipient Monitoring Condition: The County appropriately notified the subrecipients of the federal award identification and performed a risk assessment; however, the County did not monitor ten of the twelve subrecipients during the year to ensure compliance with federal statutes, regulations, and the terms and conditions of the subaward. Criteria: The Pennsylvania Department of Human Services (PA DHS) and 2 CFR section 200.332 require pass-through entities to ensure that the award is clearly identified to the subrecipient as a subaward and includes information at the time of the subaward regarding federal award identification, all requirements imposed by the pass-through entity on the subrecipient so that the federal award is used in accordance with federal statutes and the terms and conditions of the federal award, any additional requirements that the pass-through entity imposes on the subrecipient, and a requirement that the subrecipient permit the pass-through entity and auditors to have access to the subrecipient?s records and financial statements as necessary. Additionally, the pass-through entity is required to evaluate each subrecipient?s risk of noncompliance, monitoring 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 verify that every subrecipient is audited as required by Subpart F, as necessary. It is the County?s policy, as part of the monitoring process, that each subrecipient of these federal awards be monitored annually. Cause: The County has established formal subrecipient monitoring policies. However, due to staffing issues, the County?s internal control process over subrecipient monitoring was not effective. Effect: A failure to monitor subrecipients? compliance with relevant federal requirements could result in noncompliance with the terms and conditions of the subawards. Questioned Costs: Unknown. Identification as a Repeat Finding: This is not a repeat finding from the prior audit. Recommendation: We recommend that the County ensure adherence to the monitoring policy related to subrecipients and that these subrecipients be monitored on an annual basis in accordance with the policy. Management?s Response: Management agrees with this finding. See separate Corrective Action Plan.
Criteria: 2 CFR section 200.332(d) states: Pass-through entity monitoring of the subrecipient must include: (1) Reviewing financial and performance reports required by the pass-through entity. (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 Section 200-521. Condition: As the HIV Care Formula Grant is a recurring grant, the Organization requires subrecipients to provide their most recent financial statement and Uniform Guidance audits annually when reapplying for grant funds. For one of three subrecipients tested, the subrecipient provided their 2021 Federal Form 990 when applying for 2022 funding and told the Organization they did not have a financial statement or Uniform Guidance audits. The federal assistance provided by the Organization to the subrecipient was less than $750,000, so this response was consistent with the Organization?s expectation for the subrecipient. However, per our review of the Federal Form 990, the subrecipient disclosed that it was required to undergo an audit under the Single Audit Act and that the audit had not been completed. The Organization did not notice this in the Federal Form 990 and did not follow-up on the delayed audit. The Organization performed quarterly fiscal audits of the subrecipient?s expenses and site visits with no compliance issues identified. Although the Organization was not aware of the financial statement and Uniform Guidance audit requirements and the untimely status of those audits, other effective monitoring procedures were completed. Cause: The Organization was not aware of the subrecipient?s other federal assistance resulting in the subrecipient having a financial statement and uniform guidance audit requirement. Effect or potential effect: Procedures required by 2 CFR section 200.332(d) related to reviewing financial reports of the subrecipient and following-up on deficiencies pertaining to the Federal award could not completed. The Uniform Guidance audit could have noted findings related to compliance with the spending of the federal assistance that would have been unknown to the Organization. Recommendation: We recommend that the Organization require the subrecipient to provide a complete list of all their federal assistance when signing grant agreements. Based on that information received, we recommend that the Organization track all subrecipient with federal assistance over $750,000 and establish a process to ensure the financial statement and Uniform Guidance audits are obtained timely and monitoring procedures required by 2 CFR section 200.332(d) are completed. Views of responsible officials: Management acknowledges this finding and will address remediation in the accompanying corrective action plan in Appendix A.
Criteria - The Uniform Guidance in 2 CFR Section 200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. In accordance with the Uniform Guidance in 2 CFR Section 200.331, a pass-through entity (PTE) must monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, complies with the terms and conditions of the subaward, and achieves performance goals (2 CFR sections 200.332(d) through (f)). In addition to procedures identified as necessary based upon the evaluation of subrecipient risk or specifically required by the terms and conditions of the award, subaward monitoring must include the following: 1. reviewing financial and programmatic (performance and special reports) required by the PTE; 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 PTE detected through audits, on-site reviews, and other means; 3. issuing a management decision for audit findings pertaining to the federal award provided to the subrecipient from the PTE as required by 2 CFR section 200.521. Furthermore, under the requirements of the Federal Funding Accountability and Transparency Act (FFATA) (Pub. L. No. 109-282), as amended by Section 6202 of Public Law 110-252, hereafter referred as the ?Transparency Act? that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). If a subaward/subcontract was subject to reporting under the Transparency Act, the action was required to be reported in FSRS no later than the last day of the month following the month in which the subaward/subcontract amendment obligation was made or in the subcontract award/subcontract modification was made. Conditions ? Our examination of the program?s subrecipient monitoring requirements includes the review and approval of financial and performance reports by the program managers. The financial reports are prepared by APS? grants administrator and submitted to the program managers whilst the performance reports and information are submitted by the subrecipients directly to the program managers. Of the program?s nineteen (19) subrecipients, we examined fifteen (15) subrecipients and observed that there was no consistent evidentiary documentation to support the monitoring oversight process performed by the respective program managers. However, we noted that APS did perform the required monitoring procedures and oversight of the subrecipients? financial and programmatic activities based on our review of program reports submitted to NSF, e-mail communication and minutes of meetings held during the year. We selected four (4) subrecipients and noted that for all the subrecipients selected, APS was unable to provide consistent evidentiary documentation to show that it had reviewed the subrecipients? single audit reports during the year. A subsequent review of the subrecipients? audit reports was performed and no reported deficiencies relating to APS? subawards was noted. We also tested a sample of two subrecipients and our examination of the monitoring and reporting requirements revealed that APS did not report the information on a subaward of $30,000 or more in federal funds and three grant amendments in the FSRS Reporting System to fulfil the FFATA requirements. Cause ? Management does not have adequate internal controls and policies in place to ensure that the monitoring controls performed over its subrecipients are documented appropriately and in a timely manner. There is also a lack of established monitoring and internal control procedures in place to ensure that reports required under the Transparency Act are prepared and submitted timely in FSRS Reporting System resulted in APS? noncompliance with the reporting requirements.Effect or potential effect ? APS is not in compliance with the subrecipient monitoring requirements as it did not maintain consistent documented evidence of its monitoring of subrecipients. Failure to comply with the reporting requirements of the Uniform Guidance could result in the awarding agency taking action such as reducing future funding. Questioned Costs ? None. Context ? These are conditions identified per review of APS? compliance with specified compliance requirements using a statistically valid sample. Recommendations ? BDO recommends that APS implement policies, procedures and controls that will ensure that all requisite reports are reviewed, and evidence of review are consistently documented and maintained. BDO also recommends that APS establish policies and procedure over the preparation and timely submission of reports required under the Transparency Act to ensure compliance with reporting requirements. Views of Responsible Officials - APS concurs with this finding. APS?s corrective action is described in the Management?s Corrective Action Plan included below.
Criteria - The Uniform Guidance in 2 CFR Section 200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. In accordance with the Uniform Guidance in 2 CFR Section 200.331, a pass-through entity (PTE) must monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, complies with the terms and conditions of the subaward, and achieves performance goals (2 CFR sections 200.332(d) through (f)). In addition to procedures identified as necessary based upon the evaluation of subrecipient risk or specifically required by the terms and conditions of the award, subaward monitoring must include the following: 1. reviewing financial and programmatic (performance and special reports) required by the PTE; 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 PTE detected through audits, on-site reviews, and other means; 3. issuing a management decision for audit findings pertaining to the federal award provided to the subrecipient from the PTE as required by 2 CFR section 200.521. Furthermore, under the requirements of the Federal Funding Accountability and Transparency Act (FFATA) (Pub. L. No. 109-282), as amended by Section 6202 of Public Law 110-252, hereafter referred as the ?Transparency Act? that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). If a subaward/subcontract was subject to reporting under the Transparency Act, the action was required to be reported in FSRS no later than the last day of the month following the month in which the subaward/subcontract amendment obligation was made or in the subcontract award/subcontract modification was made. Conditions ? Our examination of the program?s subrecipient monitoring requirements includes the review and approval of financial and performance reports by the program managers. The financial reports are prepared by APS? grants administrator and submitted to the program managers whilst the performance reports and information are submitted by the subrecipients directly to the program managers. Of the program?s nineteen (19) subrecipients, we examined fifteen (15) subrecipients and observed that there was no consistent evidentiary documentation to support the monitoring oversight process performed by the respective program managers. However, we noted that APS did perform the required monitoring procedures and oversight of the subrecipients? financial and programmatic activities based on our review of program reports submitted to NSF, e-mail communication and minutes of meetings held during the year. We selected four (4) subrecipients and noted that for all the subrecipients selected, APS was unable to provide consistent evidentiary documentation to show that it had reviewed the subrecipients? single audit reports during the year. A subsequent review of the subrecipients? audit reports was performed and no reported deficiencies relating to APS? subawards was noted. We also tested a sample of two subrecipients and our examination of the monitoring and reporting requirements revealed that APS did not report the information on a subaward of $30,000 or more in federal funds and three grant amendments in the FSRS Reporting System to fulfil the FFATA requirements. Cause ? Management does not have adequate internal controls and policies in place to ensure that the monitoring controls performed over its subrecipients are documented appropriately and in a timely manner. There is also a lack of established monitoring and internal control procedures in place to ensure that reports required under the Transparency Act are prepared and submitted timely in FSRS Reporting System resulted in APS? noncompliance with the reporting requirements.Effect or potential effect ? APS is not in compliance with the subrecipient monitoring requirements as it did not maintain consistent documented evidence of its monitoring of subrecipients. Failure to comply with the reporting requirements of the Uniform Guidance could result in the awarding agency taking action such as reducing future funding. Questioned Costs ? None. Context ? These are conditions identified per review of APS? compliance with specified compliance requirements using a statistically valid sample. Recommendations ? BDO recommends that APS implement policies, procedures and controls that will ensure that all requisite reports are reviewed, and evidence of review are consistently documented and maintained. BDO also recommends that APS establish policies and procedure over the preparation and timely submission of reports required under the Transparency Act to ensure compliance with reporting requirements. Views of Responsible Officials - APS concurs with this finding. APS?s corrective action is described in the Management?s Corrective Action Plan included below.
Criteria - The Uniform Guidance in 2 CFR Section 200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. In accordance with the Uniform Guidance in 2 CFR Section 200.331, a pass-through entity (PTE) must monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, complies with the terms and conditions of the subaward, and achieves performance goals (2 CFR sections 200.332(d) through (f)). In addition to procedures identified as necessary based upon the evaluation of subrecipient risk or specifically required by the terms and conditions of the award, subaward monitoring must include the following: 1. reviewing financial and programmatic (performance and special reports) required by the PTE; 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 PTE detected through audits, on-site reviews, and other means; 3. issuing a management decision for audit findings pertaining to the federal award provided to the subrecipient from the PTE as required by 2 CFR section 200.521. Furthermore, under the requirements of the Federal Funding Accountability and Transparency Act (FFATA) (Pub. L. No. 109-282), as amended by Section 6202 of Public Law 110-252, hereafter referred as the ?Transparency Act? that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). If a subaward/subcontract was subject to reporting under the Transparency Act, the action was required to be reported in FSRS no later than the last day of the month following the month in which the subaward/subcontract amendment obligation was made or in the subcontract award/subcontract modification was made. Conditions ? Our examination of the program?s subrecipient monitoring requirements includes the review and approval of financial and performance reports by the program managers. The financial reports are prepared by APS? grants administrator and submitted to the program managers whilst the performance reports and information are submitted by the subrecipients directly to the program managers. Of the program?s nineteen (19) subrecipients, we examined fifteen (15) subrecipients and observed that there was no consistent evidentiary documentation to support the monitoring oversight process performed by the respective program managers. However, we noted that APS did perform the required monitoring procedures and oversight of the subrecipients? financial and programmatic activities based on our review of program reports submitted to NSF, e-mail communication and minutes of meetings held during the year. We selected four (4) subrecipients and noted that for all the subrecipients selected, APS was unable to provide consistent evidentiary documentation to show that it had reviewed the subrecipients? single audit reports during the year. A subsequent review of the subrecipients? audit reports was performed and no reported deficiencies relating to APS? subawards was noted. We also tested a sample of two subrecipients and our examination of the monitoring and reporting requirements revealed that APS did not report the information on a subaward of $30,000 or more in federal funds and three grant amendments in the FSRS Reporting System to fulfil the FFATA requirements. Cause ? Management does not have adequate internal controls and policies in place to ensure that the monitoring controls performed over its subrecipients are documented appropriately and in a timely manner. There is also a lack of established monitoring and internal control procedures in place to ensure that reports required under the Transparency Act are prepared and submitted timely in FSRS Reporting System resulted in APS? noncompliance with the reporting requirements.Effect or potential effect ? APS is not in compliance with the subrecipient monitoring requirements as it did not maintain consistent documented evidence of its monitoring of subrecipients. Failure to comply with the reporting requirements of the Uniform Guidance could result in the awarding agency taking action such as reducing future funding. Questioned Costs ? None. Context ? These are conditions identified per review of APS? compliance with specified compliance requirements using a statistically valid sample. Recommendations ? BDO recommends that APS implement policies, procedures and controls that will ensure that all requisite reports are reviewed, and evidence of review are consistently documented and maintained. BDO also recommends that APS establish policies and procedure over the preparation and timely submission of reports required under the Transparency Act to ensure compliance with reporting requirements. Views of Responsible Officials - APS concurs with this finding. APS?s corrective action is described in the Management?s Corrective Action Plan included below.
FINDING 2022-003 Subject: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds - Subrecipient Monitoring Federal Agency: Department of the Treasury Federal Program: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Assistance Listings Number: 21.027 Federal Award Number or Year (or Other Identifying Number): CY2021 Compliance Requirement: Subrecipient Monitoring Audit Findings: Material Weakness, Modified Opinion Condition and Context The City received a total State and Local Fiscal Recovery Funds (SLFRF) allocation of $18,042,360. The City enlisted a non-profit, Heart City Health Center, Inc., to assist with public health information and paid them $50,000. The payment was made under the Responding to Public Health and Economic Impacts of COVID-19 eligible use category. Documentation to support the payment included an invoice from the Heart City Health Center, Inc., Board of Works Resolution 21-R-19, and Ordinance 5861. The Board of Works approved Resolution 21-R-19 on December 28, 2021. The resolution states in part, "Heart City Health Center is a separate legal entity from the City of Elkhart and as a separate legal entity, requires the formation of a subrecipient agreement to transfer funds from the City's ARPA Coronavirus State and Local Fiscal Recovery Funds allocation to Heart City Health . . . now, therefore be it resolved, the Board of Public Works approves Heart City Health Center Inc. as a subrecipient of fifty thousand dollars in ARPA state and local fiscal recovery funds, and authorizes the Department of Law to prepare an appropriates subrecipient agreement for execution by the Board of Works and Heart City Health Center Inc. for the purposes approved herein . . ." The City provided SLFRF award funds to the Heart City Health Center, Inc. to carry out a program on the City's behalf, making the Heart City Health Center, Inc. a subrecipient of the City, as noted in their resolution, and, therefore, subject to subrecipient monitoring. The City was unable provide a copy of the subaward agreement or other supporting documentation to show evaluation of the subrecipient's risk of noncompliance or monitoring activities demonstrating compliance with the subrecipient monitoring requirement. The lack of internal controls and noncompliance were systemic issues throughout the audit period. 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 200.331(a) states in part: "Subrecipients. A subaward is for the purpose of carrying out a portion of a Federal award and creates a Federal assistance relationship with the subrecipient. . . . Characteristics which support the classification of the non-Federal entity as a subrecipient include when the non- Federal entity: (1) Determines who is eligible to receive what Federal assistance; (2) Has its performance measured in relation to whether objectives of a Federal program were met; (3) Has responsibility for programmatic decision-making; (4) Is responsible for adherence to applicable Federal program requirements specified in the Federal award; and . . ." 2 CFR 200.332 states in part: "All pass-through entities must: (a) Ensure that every subaward is clearly identified to the subrecipient as a subaward and includes the following information at the time of the subaward . . . (1) Federal award identification. (i) Subrecipient name (which must match the name associated with its unique entity identifier); (ii) Subrecipient's unique entity identifier; (iii) Federal Award Identification Number (FAIN); (iv) Federal Award Date (see the definition of Federal award date in ? 200.1 of this part) of award to the recipient by the Federal agency; (v) Subaward Period of Performance Start and End Date; (vi) Subaward Budget Period Start and End Date; (vii) Amount of Federal Funds Obligated by this action by the pass-through entity to the subrecipient; (viii) Total Amount of Federal Funds Obligated to the subrecipient by the passthrough entity including the current financial obligation; (ix) Total Amount of the Federal Award committed to the subrecipient by the passthrough entity; (x) Federal award project description, as required to be responsive to the Federal Funding Accountability and Transparency Act (FFATA); (xi) Name of Federal awarding agency, pass-through entity, and contact information for awarding official of the Pass-through entity; (xii) Assistance Listings number and Title; the pass-through entity must identify the dollar amount made available under each Federal award and the Assistance Listings Number at time of disbursement; (xiii) Identification of whether the award is R&D; and (xiv) Indirect cost rate for the Federal award (including if the de minimis rate is charged) per ? 200.414. (2) All requirements imposed by the pass-through entity on the subrecipient so that the Federal award is used in accordance with Federal statutes, regulations and the terms and conditions of the Federal award; (3) Any additional requirements that the pass-through entity imposes on the subrecipient in order for the pass-through entity to meet its own responsibility to the Federal awarding agency including identification of any required financial and performance reports; (4) (i) An approved federally recognized indirect cost rate negotiated between the subrecipient and the Federal Government. If no approved rate exists, the passthrough entity must determine the appropriate rate in collaboration with the subrecipient, which is either: (A) The negotiated indirect cost rate between the pass-through entity and the subrecipient; which can be based on a prior negotiated rate between a different PTE and the same subrecipient. If basing the rate on a previously negotiated rate, the pass-through entity is not required to collect information justifying this rate, but may elect to do so; (B) The de minimis indirect cost rate. (ii) The pass-through entity must not require use of a de minimis indirect cost rate if the subrecipient has a Federally approved rate. Subrecipients can elect to use the cost allocation method to account for indirect costs in accordance with ? 200.405(d). (5) A requirement that the subrecipient permit the pass-through entity and auditors to have access to the subrecipient's records and financial statements as necessary for the pass-through entity to meet the requirements of this part; and (6) Appropriate terms and conditions concerning closeout of the subaward. . . . (b) Evaluate each subrecipient's risk of noncompliance with Federal statues, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring . . . (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: (1) Reviewing financial and performance reports required by the passthrough entity. (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. (4) The pass-through entity is responsible for resolving audit findings specifically related to the subaward and not responsible for resolving crosscutting findings. . . ." Cause The system of internal controls as established by management of the City was not properly designed nor implemented. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the City's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. 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. The City was responsible for providing a subaward agreement and monitoring the nonprofit. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the City. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the City design and implement a proper system of internal controls and develop policies and procedures to ensure subrecipients are provided with an adequate subaward agreement and monitored as appropriate. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
Criteria: 2 CFR 200.332 notes, ?All pass-through entities must: (a) Ensure that every subaward is clearly identified to the subrecipient as a subaward and includes the following information at the time of the subaward and if any of these data elements change, include the changes in subsequent subaward modification. When some of this information is not available, the pass-through entity must provide the best information available to describe the Federal award and subaward. Required information includes: (1) Federal award identification. (i) Subrecipient name (which must match the name associated with its unique entity identifier); (ii) Subrecipient's unique entity identifier; (iii) Federal Award Identification Number (FAIN); (iv) Federal Award Date (see the definition of Federal award date in ? 200.1 of this part) of award to the recipient by the Federal agency; (v) Subaward Period of Performance Start and End Date; (vi) Subaward Budget Period Start and End Date; (vii) Amount of Federal Funds Obligated by this action by the pass-through entity to the subrecipient; (viii) Total Amount of Federal Funds Obligated to the subrecipient by the pass-through entity including the current financial obligation; (ix) Total Amount of the Federal Award committed to the subrecipient by the pass-through entity; (x) Federal award project description, as required to be responsive to the Federal Funding Accountability and Transparency Act (FFATA); (xi) Name of Federal awarding agency, pass-through entity, and contact information for awarding official of the Pass-through entity; (xii) Assistance Listings number and Title; the pass-through entity must identify the dollar amount made available under each Federal award and the Assistance Listings Number at time of disbursement; (xiii) Identification of whether the award is R&D; and (xiv) Indirect cost rate for the Federal award (including if the de minimis rate is charged) per ? 200.414. (2) All requirements imposed by the pass-through entity on the subrecipient so that the Federal award is used in accordance with Federal statutes, regulations and the terms and conditions of the Federal award; ?? Condition: For all four subawards selected for testing, the identification of the award being Research and Development (R&D) was not noted. Further, two of the four subawards selected for testing, had information missing from the subaward including (1) Recipient DUNS number (2) Unique Federal Award Identification Number (FAIN) (3) Assistance Listing number (4) Indirect Cost Rate. Lastly, one subaward did not include the following information: (a) Period of Performance of subaward (b) Amount of federal funds obligated and awarded (c) General terms and conditions of subaward (d) Federal award project description (e) Name of Federal awarding agency. Condition (Continued): We consider this condition to be an instance of noncompliance relating to the Subrecipient Monitoring compliance requirement. Statistical sampling was not used in making sample selections. Questioned Costs: N/A. Cause and Effect: Without communication of the required information, subrecipients may overspend award amounts or incur unallowable expenses towards the grant. Recommendation: We recommend the Organization evaluates policies and procedures to ensure all required information is communication with the subrecipient. Views of Responsible Officials: Management agrees with this Single Audit Finding and response is included in the Corrective Action Plan.
Criteria: 2 CFR 200.332 notes, ?All pass-through entities must: (a) Ensure that every subaward is clearly identified to the subrecipient as a subaward and includes the following information at the time of the subaward and if any of these data elements change, include the changes in subsequent subaward modification. When some of this information is not available, the pass-through entity must provide the best information available to describe the Federal award and subaward. Required information includes: (1) Federal award identification. (i) Subrecipient name (which must match the name associated with its unique entity identifier); (ii) Subrecipient's unique entity identifier; (iii) Federal Award Identification Number (FAIN); (iv) Federal Award Date (see the definition of Federal award date in ? 200.1 of this part) of award to the recipient by the Federal agency; (v) Subaward Period of Performance Start and End Date; (vi) Subaward Budget Period Start and End Date; (vii) Amount of Federal Funds Obligated by this action by the pass-through entity to the subrecipient; (viii) Total Amount of Federal Funds Obligated to the subrecipient by the pass-through entity including the current financial obligation; (ix) Total Amount of the Federal Award committed to the subrecipient by the pass-through entity; (x) Federal award project description, as required to be responsive to the Federal Funding Accountability and Transparency Act (FFATA); (xi) Name of Federal awarding agency, pass-through entity, and contact information for awarding official of the Pass-through entity; (xii) Assistance Listings number and Title; the pass-through entity must identify the dollar amount made available under each Federal award and the Assistance Listings Number at time of disbursement; (xiii) Identification of whether the award is R&D; and (xiv) Indirect cost rate for the Federal award (including if the de minimis rate is charged) per ? 200.414. (2) All requirements imposed by the pass-through entity on the subrecipient so that the Federal award is used in accordance with Federal statutes, regulations and the terms and conditions of the Federal award; ?? Condition: For all four subawards selected for testing, the identification of the award being Research and Development (R&D) was not noted. Further, two of the four subawards selected for testing, had information missing from the subaward including (1) Recipient DUNS number (2) Unique Federal Award Identification Number (FAIN) (3) Assistance Listing number (4) Indirect Cost Rate. Lastly, one subaward did not include the following information: (a) Period of Performance of subaward (b) Amount of federal funds obligated and awarded (c) General terms and conditions of subaward (d) Federal award project description (e) Name of Federal awarding agency. Condition (Continued): We consider this condition to be an instance of noncompliance relating to the Subrecipient Monitoring compliance requirement. Statistical sampling was not used in making sample selections. Questioned Costs: N/A. Cause and Effect: Without communication of the required information, subrecipients may overspend award amounts or incur unallowable expenses towards the grant. Recommendation: We recommend the Organization evaluates policies and procedures to ensure all required information is communication with the subrecipient. Views of Responsible Officials: Management agrees with this Single Audit Finding and response is included in the Corrective Action Plan.
Criteria: 2 CFR 200.332 notes, ?All pass-through entities must: (a) Ensure that every subaward is clearly identified to the subrecipient as a subaward and includes the following information at the time of the subaward and if any of these data elements change, include the changes in subsequent subaward modification. When some of this information is not available, the pass-through entity must provide the best information available to describe the Federal award and subaward. Required information includes: (1) Federal award identification. (i) Subrecipient name (which must match the name associated with its unique entity identifier); (ii) Subrecipient's unique entity identifier; (iii) Federal Award Identification Number (FAIN); (iv) Federal Award Date (see the definition of Federal award date in ? 200.1 of this part) of award to the recipient by the Federal agency; (v) Subaward Period of Performance Start and End Date; (vi) Subaward Budget Period Start and End Date; (vii) Amount of Federal Funds Obligated by this action by the pass-through entity to the subrecipient; (viii) Total Amount of Federal Funds Obligated to the subrecipient by the pass-through entity including the current financial obligation; (ix) Total Amount of the Federal Award committed to the subrecipient by the pass-through entity; (x) Federal award project description, as required to be responsive to the Federal Funding Accountability and Transparency Act (FFATA); (xi) Name of Federal awarding agency, pass-through entity, and contact information for awarding official of the Pass-through entity; (xii) Assistance Listings number and Title; the pass-through entity must identify the dollar amount made available under each Federal award and the Assistance Listings Number at time of disbursement; (xiii) Identification of whether the award is R&D; and (xiv) Indirect cost rate for the Federal award (including if the de minimis rate is charged) per ? 200.414. (2) All requirements imposed by the pass-through entity on the subrecipient so that the Federal award is used in accordance with Federal statutes, regulations and the terms and conditions of the Federal award; ?? Condition: For all four subawards selected for testing, the identification of the award being Research and Development (R&D) was not noted. Further, two of the four subawards selected for testing, had information missing from the subaward including (1) Recipient DUNS number (2) Unique Federal Award Identification Number (FAIN) (3) Assistance Listing number (4) Indirect Cost Rate. Lastly, one subaward did not include the following information: (a) Period of Performance of subaward (b) Amount of federal funds obligated and awarded (c) General terms and conditions of subaward (d) Federal award project description (e) Name of Federal awarding agency. Condition (Continued): We consider this condition to be an instance of noncompliance relating to the Subrecipient Monitoring compliance requirement. Statistical sampling was not used in making sample selections. Questioned Costs: N/A. Cause and Effect: Without communication of the required information, subrecipients may overspend award amounts or incur unallowable expenses towards the grant. Recommendation: We recommend the Organization evaluates policies and procedures to ensure all required information is communication with the subrecipient. Views of Responsible Officials: Management agrees with this Single Audit Finding and response is included in the Corrective Action Plan.
Material Weakness, Compliance and Internal Control over Compliance, Subrecipient Monitoring ALN 21.027: Coronavirus State and Local Fiscal Recovery Funds Federal Agency: U.S. Department of the Treasury Criteria Or Specific Requirement: Per 2 CFR 200.332, Mesa County is responsible for informing subrecipients of the Federal award identifiers including but not limited to award date, period of performance and Federal awarding agency and Assistance Listing Number and title. Mesa County is required to assess the subrecipient?s risk of noncompliance with Federal statutes, regulations and the terms and conditions of the subaward. In addition, the County should also verify that the subrecipient is audited as required by Subpart F- Audit Requirement under the Uniform Guidance. The monitoring policy should include an initial valuation of risk of noncompliance to determine the appropriate level of monitoring required related to the subaward as well as appropriate awarding documentation. Condition: We noted that management did not evaluate the risk of noncompliance of the subrecipient and did not convey expectation of requirements for audit under Federal Regulations. Effect: The County was not in compliance with the subrecipient monitoring regulations set forth in the Uniform Guidance. The possibility exists that noncompliance with federal requirements could go undetected without proper controls over compliance relating to the aforementioned requirements. Questioned Costs: None Context: During the testing performed, we noted the County did not perform a risk assessment of subrecipient nor did the County have documentation of informing the subrecipient of all required rules and regulations, including the need for the subrecipient to receive an audit as required under Uniform Guidance. Identification As A Repeat Finding: Not Applicable Recommendation: We recommend that management implement a formal subrecipient monitoring policy that defines how the County will monitor each subrecipient. This policy should include an evaluation of the risk of noncompliance for each subrecipient as well as how the subrecipients will be monitored. The County should also request a copy of the subrecipient?s audit, if applicable.
Finding Number: 2022-007 Repeat Finding: Yes Type of Finding: Material Weakness in Internal Control and Material Noncompliance Description: Subrecipient Monitoring and Management Major Programs AL#93.665 - Emergency Grants to Address Mental and Substance Use Disorders During COVID-19 ? Direct Award (DHHS) ? Award numbers: 6H79FG000252-01M003 and 6H79FG000689-01M004 AL#93.772 - Tribal Public Health Capacity Building and Quality Improvement Umbrella Cooperative Agreement ? Direct Award (DHHS) ? Award numbers: 5NU38OT000257-04-00 and 5NU38OT000257-05-00 Questioned Costs: None How the questioned costs were computed: N/A Compliance Requirement: Subrecipient Monitoring Condition: The Organization did not comply with any of the subrecipient monitoring and management requirements in accordance with 2 CFR Part 200.332. Criteria: The subrecipient monitoring and management requirements that are codified in 2 CFR Part 200.332 requires the pass-through entity must: Ensure that every subaward is clearly identified to the subrecipient as a subaward and includes: Federal award identification; All requirements imposed by the pass-through entity on the subrecipient so that the Federal award is used in accordance with Federal statutes, regulations and the terms and conditions of the Federal award; Any additional requirements that the pass-through entity imposes on the subrecipient in order for the pass-through entity to meet its own responsibility to the Federal awarding agency including identification of any required financial and performance reports. An approved federally recognized indirect cost rate negotiated between the subrecipient and the Federal Government. If no approved rate exists, the pass-through entity must determine the appropriate rate in collaboration with the subrecipient, which is either: The negotiated indirect cost rate between the pass-through entity and the subrecipient; The de minimis indirect cost rate The pass-through entity must not require use of a de minimis indirect cost rate if the subrecipient has a Federally approved rate. A requirement that the subrecipient permit the pass-through entity and auditors to have access to the subrecipient?s records and financial statements as necessary for the pass-through entity to meet the requirements of this part; and Appropriate terms and conditions concerning closeout of the subaward. 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. Consider imposing specific subaward conditions upon a subrecipient if appropriate as described in ? 200.208. 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: Reviewing financial and performance reports required by the pass-through entity. 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. 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. The pass-through entity is responsible for resolving audit findings specifically related to the subaward and not responsible for resolving crosscutting findings. If a subrecipient has a current Single Audit report posted in the Federal Audit Clearinghouse and has not otherwise been excluded from receipt of Federal funding (e.g., has been debarred or suspended), the pass-through entity may rely on the subrecipient's cognizant audit agency or cognizant oversight agency to perform audit follow-up and make management decisions related to cross-cutting findings in accordance with section ? 200.513(a)(3)(vii). Such reliance does not eliminate the responsibility of the pass-through entity to issue subawards that conform to agency and award-specific requirements, to manage risk through ongoing subaward monitoring, and to monitor the status of the findings that are specifically related to the subaward. Depending upon the pass-through entity's assessment of risk posed by the subrecipient, the following monitoring tools may be useful for the pass-through entity to ensure proper accountability and compliance with program requirements and achievement of performance goals: Providing subrecipients with training and technical assistance on program-related matters; and Performing on-site reviews of the subrecipient's program operations; Arranging for agreed-upon-procedures engagements as described in ? 200.425. 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 ? 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. Consider taking enforcement action against noncompliant subrecipients as described in ? 200.339 of this part and in program regulations. Cause: The Organization?s management was not aware of the subrecipient monitoring and management requirements. Effect: The Organization was not in compliance with any of the subrecipient monitoring and management requirements, resulting in a material noncompliance and a material weakness in internal controls over compliance. Recommendation: We recommend the Organization implement systems and procedures to ensure compliance with the subrecipient monitoring and management compliance requirements.
Finding Number: 2022-007 Repeat Finding: Yes Type of Finding: Material Weakness in Internal Control and Material Noncompliance Description: Subrecipient Monitoring and Management Major Programs AL#93.665 - Emergency Grants to Address Mental and Substance Use Disorders During COVID-19 ? Direct Award (DHHS) ? Award numbers: 6H79FG000252-01M003 and 6H79FG000689-01M004 AL#93.772 - Tribal Public Health Capacity Building and Quality Improvement Umbrella Cooperative Agreement ? Direct Award (DHHS) ? Award numbers: 5NU38OT000257-04-00 and 5NU38OT000257-05-00 Questioned Costs: None How the questioned costs were computed: N/A Compliance Requirement: Subrecipient Monitoring Condition: The Organization did not comply with any of the subrecipient monitoring and management requirements in accordance with 2 CFR Part 200.332. Criteria: The subrecipient monitoring and management requirements that are codified in 2 CFR Part 200.332 requires the pass-through entity must: Ensure that every subaward is clearly identified to the subrecipient as a subaward and includes: Federal award identification; All requirements imposed by the pass-through entity on the subrecipient so that the Federal award is used in accordance with Federal statutes, regulations and the terms and conditions of the Federal award; Any additional requirements that the pass-through entity imposes on the subrecipient in order for the pass-through entity to meet its own responsibility to the Federal awarding agency including identification of any required financial and performance reports. An approved federally recognized indirect cost rate negotiated between the subrecipient and the Federal Government. If no approved rate exists, the pass-through entity must determine the appropriate rate in collaboration with the subrecipient, which is either: The negotiated indirect cost rate between the pass-through entity and the subrecipient; The de minimis indirect cost rate The pass-through entity must not require use of a de minimis indirect cost rate if the subrecipient has a Federally approved rate. A requirement that the subrecipient permit the pass-through entity and auditors to have access to the subrecipient?s records and financial statements as necessary for the pass-through entity to meet the requirements of this part; and Appropriate terms and conditions concerning closeout of the subaward. 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. Consider imposing specific subaward conditions upon a subrecipient if appropriate as described in ? 200.208. 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: Reviewing financial and performance reports required by the pass-through entity. 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. 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. The pass-through entity is responsible for resolving audit findings specifically related to the subaward and not responsible for resolving crosscutting findings. If a subrecipient has a current Single Audit report posted in the Federal Audit Clearinghouse and has not otherwise been excluded from receipt of Federal funding (e.g., has been debarred or suspended), the pass-through entity may rely on the subrecipient's cognizant audit agency or cognizant oversight agency to perform audit follow-up and make management decisions related to cross-cutting findings in accordance with section ? 200.513(a)(3)(vii). Such reliance does not eliminate the responsibility of the pass-through entity to issue subawards that conform to agency and award-specific requirements, to manage risk through ongoing subaward monitoring, and to monitor the status of the findings that are specifically related to the subaward. Depending upon the pass-through entity's assessment of risk posed by the subrecipient, the following monitoring tools may be useful for the pass-through entity to ensure proper accountability and compliance with program requirements and achievement of performance goals: Providing subrecipients with training and technical assistance on program-related matters; and Performing on-site reviews of the subrecipient's program operations; Arranging for agreed-upon-procedures engagements as described in ? 200.425. 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 ? 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. Consider taking enforcement action against noncompliant subrecipients as described in ? 200.339 of this part and in program regulations. Cause: The Organization?s management was not aware of the subrecipient monitoring and management requirements. Effect: The Organization was not in compliance with any of the subrecipient monitoring and management requirements, resulting in a material noncompliance and a material weakness in internal controls over compliance. Recommendation: We recommend the Organization implement systems and procedures to ensure compliance with the subrecipient monitoring and management compliance requirements.
Finding Number: 2022-007 Repeat Finding: Yes Type of Finding: Material Weakness in Internal Control and Material Noncompliance Description: Subrecipient Monitoring and Management Major Programs AL#93.665 - Emergency Grants to Address Mental and Substance Use Disorders During COVID-19 ? Direct Award (DHHS) ? Award numbers: 6H79FG000252-01M003 and 6H79FG000689-01M004 AL#93.772 - Tribal Public Health Capacity Building and Quality Improvement Umbrella Cooperative Agreement ? Direct Award (DHHS) ? Award numbers: 5NU38OT000257-04-00 and 5NU38OT000257-05-00 Questioned Costs: None How the questioned costs were computed: N/A Compliance Requirement: Subrecipient Monitoring Condition: The Organization did not comply with any of the subrecipient monitoring and management requirements in accordance with 2 CFR Part 200.332. Criteria: The subrecipient monitoring and management requirements that are codified in 2 CFR Part 200.332 requires the pass-through entity must: Ensure that every subaward is clearly identified to the subrecipient as a subaward and includes: Federal award identification; All requirements imposed by the pass-through entity on the subrecipient so that the Federal award is used in accordance with Federal statutes, regulations and the terms and conditions of the Federal award; Any additional requirements that the pass-through entity imposes on the subrecipient in order for the pass-through entity to meet its own responsibility to the Federal awarding agency including identification of any required financial and performance reports. An approved federally recognized indirect cost rate negotiated between the subrecipient and the Federal Government. If no approved rate exists, the pass-through entity must determine the appropriate rate in collaboration with the subrecipient, which is either: The negotiated indirect cost rate between the pass-through entity and the subrecipient; The de minimis indirect cost rate The pass-through entity must not require use of a de minimis indirect cost rate if the subrecipient has a Federally approved rate. A requirement that the subrecipient permit the pass-through entity and auditors to have access to the subrecipient?s records and financial statements as necessary for the pass-through entity to meet the requirements of this part; and Appropriate terms and conditions concerning closeout of the subaward. 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. Consider imposing specific subaward conditions upon a subrecipient if appropriate as described in ? 200.208. 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: Reviewing financial and performance reports required by the pass-through entity. 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. 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. The pass-through entity is responsible for resolving audit findings specifically related to the subaward and not responsible for resolving crosscutting findings. If a subrecipient has a current Single Audit report posted in the Federal Audit Clearinghouse and has not otherwise been excluded from receipt of Federal funding (e.g., has been debarred or suspended), the pass-through entity may rely on the subrecipient's cognizant audit agency or cognizant oversight agency to perform audit follow-up and make management decisions related to cross-cutting findings in accordance with section ? 200.513(a)(3)(vii). Such reliance does not eliminate the responsibility of the pass-through entity to issue subawards that conform to agency and award-specific requirements, to manage risk through ongoing subaward monitoring, and to monitor the status of the findings that are specifically related to the subaward. Depending upon the pass-through entity's assessment of risk posed by the subrecipient, the following monitoring tools may be useful for the pass-through entity to ensure proper accountability and compliance with program requirements and achievement of performance goals: Providing subrecipients with training and technical assistance on program-related matters; and Performing on-site reviews of the subrecipient's program operations; Arranging for agreed-upon-procedures engagements as described in ? 200.425. 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 ? 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. Consider taking enforcement action against noncompliant subrecipients as described in ? 200.339 of this part and in program regulations. Cause: The Organization?s management was not aware of the subrecipient monitoring and management requirements. Effect: The Organization was not in compliance with any of the subrecipient monitoring and management requirements, resulting in a material noncompliance and a material weakness in internal controls over compliance. Recommendation: We recommend the Organization implement systems and procedures to ensure compliance with the subrecipient monitoring and management compliance requirements.
Finding 2022-002 – Subrecipient Monitoring Department of Health and Human Services Passed through Pennsylvania Department of Human Services Foster Care – Title IV-E – ALN 93.658 Subrecipient Monitoring Condition: The County appropriately notified the subrecipients of the federal award identification and performed a risk assessment; however, the County did not monitor ten of the twelve subrecipients during the year to ensure compliance with federal statutes, regulations, and the terms and conditions of the subaward. Criteria: The Pennsylvania Department of Human Services (PA DHS) and 2 CFR section 200.332 require pass-through entities to ensure that the award is clearly identified to the subrecipient as a subaward and includes information at the time of the subaward regarding federal award identification, all requirements imposed by the pass-through entity on the subrecipient so that the federal award is used in accordance with federal statutes and the terms and conditions of the federal award, any additional requirements that the pass-through entity imposes on the subrecipient, and a requirement that the subrecipient permit the pass-through entity and auditors to have access to the subrecipient’s records and financial statements as necessary. Additionally, the pass-through entity is required to evaluate each subrecipient’s risk of noncompliance, monitoring 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 verify that every subrecipient is audited as required by Subpart F, as necessary. It is the County’s policy, as part of the monitoring process, that each subrecipient of these federal awards be monitored annually. Cause: The County has established formal subrecipient monitoring policies. However, due to staffing issues, the County’s internal control process over subrecipient monitoring was not effective. Effect: A failure to monitor subrecipients’ compliance with relevant federal requirements could result in noncompliance with the terms and conditions of the subawards. Questioned Costs: Unknown. Identification as a Repeat Finding: This is not a repeat finding from the prior audit. Recommendation: We recommend that the County ensure adherence to the monitoring policy related to subrecipients and that these subrecipients be monitored on an annual basis in accordance with the policy. Management’s Response: Management agrees with this finding. See separate Corrective Action Plan.
Finding 2022-002 – Subrecipient Monitoring Department of Health and Human Services Passed through Pennsylvania Department of Human Services Foster Care – Title IV-E – ALN 93.658 Subrecipient Monitoring Condition: The County appropriately notified the subrecipients of the federal award identification and performed a risk assessment; however, the County did not monitor ten of the twelve subrecipients during the year to ensure compliance with federal statutes, regulations, and the terms and conditions of the subaward. Criteria: The Pennsylvania Department of Human Services (PA DHS) and 2 CFR section 200.332 require pass-through entities to ensure that the award is clearly identified to the subrecipient as a subaward and includes information at the time of the subaward regarding federal award identification, all requirements imposed by the pass-through entity on the subrecipient so that the federal award is used in accordance with federal statutes and the terms and conditions of the federal award, any additional requirements that the pass-through entity imposes on the subrecipient, and a requirement that the subrecipient permit the pass-through entity and auditors to have access to the subrecipient’s records and financial statements as necessary. Additionally, the pass-through entity is required to evaluate each subrecipient’s risk of noncompliance, monitoring 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 verify that every subrecipient is audited as required by Subpart F, as necessary. It is the County’s policy, as part of the monitoring process, that each subrecipient of these federal awards be monitored annually. Cause: The County has established formal subrecipient monitoring policies. However, due to staffing issues, the County’s internal control process over subrecipient monitoring was not effective. Effect: A failure to monitor subrecipients’ compliance with relevant federal requirements could result in noncompliance with the terms and conditions of the subawards. Questioned Costs: Unknown. Identification as a Repeat Finding: This is not a repeat finding from the prior audit. Recommendation: We recommend that the County ensure adherence to the monitoring policy related to subrecipients and that these subrecipients be monitored on an annual basis in accordance with the policy. Management’s Response: Management agrees with this finding. See separate Corrective Action Plan.
Finding 2022-002 – Subrecipient Monitoring Department of Health and Human Services Passed through Pennsylvania Department of Human Services Foster Care – Title IV-E – ALN 93.658 Subrecipient Monitoring Condition: The County appropriately notified the subrecipients of the federal award identification and performed a risk assessment; however, the County did not monitor ten of the twelve subrecipients during the year to ensure compliance with federal statutes, regulations, and the terms and conditions of the subaward. Criteria: The Pennsylvania Department of Human Services (PA DHS) and 2 CFR section 200.332 require pass-through entities to ensure that the award is clearly identified to the subrecipient as a subaward and includes information at the time of the subaward regarding federal award identification, all requirements imposed by the pass-through entity on the subrecipient so that the federal award is used in accordance with federal statutes and the terms and conditions of the federal award, any additional requirements that the pass-through entity imposes on the subrecipient, and a requirement that the subrecipient permit the pass-through entity and auditors to have access to the subrecipient’s records and financial statements as necessary. Additionally, the pass-through entity is required to evaluate each subrecipient’s risk of noncompliance, monitoring 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 verify that every subrecipient is audited as required by Subpart F, as necessary. It is the County’s policy, as part of the monitoring process, that each subrecipient of these federal awards be monitored annually. Cause: The County has established formal subrecipient monitoring policies. However, due to staffing issues, the County’s internal control process over subrecipient monitoring was not effective. Effect: A failure to monitor subrecipients’ compliance with relevant federal requirements could result in noncompliance with the terms and conditions of the subawards. Questioned Costs: Unknown. Identification as a Repeat Finding: This is not a repeat finding from the prior audit. Recommendation: We recommend that the County ensure adherence to the monitoring policy related to subrecipients and that these subrecipients be monitored on an annual basis in accordance with the policy. Management’s Response: Management agrees with this finding. See separate Corrective Action Plan.
(MATERIAL WEAKNESS) – SUBRECIPIENT MONITORING– ALN 21.027 – COVID-19 – CORONAVIRUS STATE AND LOCAL FISCAL RECOVERY FUNDS Condition The County did not have an effective process in place to ensure required communications occur with subrecipients of federal awards. The agreements with the subrecipients did not explicitly include certain information required under 2 CFR 200.332(a)(1). Criteria The Federal Compliance Supplement and 2 CFR Section 200.332 requires pass-through entities to communicate and clearly identify to the subrecipient: 1) the award as a subaward at the time of the subaward by providing the information described in 2 CFR section 200.332(a)(1); 2) all requirements imposed by the pass-through entity on the subrecipient so that the federal award is used in accordance with federal statutes, regulations, and terms and conditions of the award; and 3) any additional requirements the pass-through entity imposes on the subrecipient in order for the pass-through entity to meet its own responsibility for the federal award. It also requires the pass-through entity to verify that every subrecipient is audited under the Uniform Guidance when required. Cause Management was not aware of the additional communication requirements imposed on pass-through entities. Effect There is a risk of noncompliance with the subrecipient monitoring communications, as well as a risk the subrecipient(s) may not be audited in accordance with the Uniform Guidance when required. Recommendation We recommend the County update its communications with subrecipients to include the required communications of the subrecipients’ responsibilities under the federal requirements, grant agreements and award requirements including, but not limited to its audit obligations under the Uniform Guidance. Questioned Costs None noted Views of Responsible Officials The county added information to the Payment Request Form to ensure that sub recipients are aware of possible single audit requirements, active SAM registry and UEI.