2 CFR § 3474.1 gives regulatory effect to the Department of Education for 2 CFR § 200.332, which established requirements over subawards for pass-through entities and states, in part: All pass-through entities must: a) Verify that the subrecipient is not excluded or disqualified in accordance with § 180.300. Verification methods are provided in § 180.300, which include confirming in SAM.gov that a potential subrecipient is not suspended, debarred, or otherwise excluded from receiving Federal funds. b) 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. c) Evaluate each subrecipient's risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring described in paragraph (f) of this section; d) If appropriate, consider implementing specific conditions in a subaward as described in § 200.208 and notify the Federal agency of the specific conditions. e) 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; f) Depending upon the pass-through entity's assessment of risk posed by the subrecipient (as described in paragraph (c) of this section), the CFR lists monitoring tools that may be useful for the pass-through entity to ensure proper accountability and compliance with program requirements and achievement of performance goals. We noted the District did not perform a subrecipient checklist prior to allocating funds. Additionally, the District did not complete monitoring procedures for subrecipients. Further, we noted the District signed a service agreement with the subrecipient; however, the agreement did not specifically identify the subrecipient as a subrecipient or include all award information as required above. Per inquiry of the Treasurer, the District does not review audit reports of the subrecipient for any noted deficiencies. The District should implement procedures to verify that all required reviews and any additional required follow ups are completed and accurately documented. Further, the District should ensure all required information is included in the subrecipient agreement. We recommend that the District request copies of annual audit reports of the subrecipient to review the report for any potential deficiencies.
2 CFR § 3474.1 gives regulatory effect to the Department of Education for 2 CFR § 200.332, which established requirements over subawards for pass-through entities and states, in part: All pass-through entities must: a) Verify that the subrecipient is not excluded or disqualified in accordance with § 180.300. Verification methods are provided in § 180.300, which include confirming in SAM.gov that a potential subrecipient is not suspended, debarred, or otherwise excluded from receiving Federal funds. b) 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. c) Evaluate each subrecipient's risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring described in paragraph (f) of this section; d) If appropriate, consider implementing specific conditions in a subaward as described in § 200.208 and notify the Federal agency of the specific conditions. e) 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; f) Depending upon the pass-through entity's assessment of risk posed by the subrecipient (as described in paragraph (c) of this section), the CFR lists monitoring tools that may be useful for the pass-through entity to ensure proper accountability and compliance with program requirements and achievement of performance goals. We noted the District did not perform a subrecipient checklist prior to allocating funds. Additionally, the District did not complete monitoring procedures for subrecipients. Further, we noted the District signed a service agreement with the subrecipient; however, the agreement did not specifically identify the subrecipient as a subrecipient or include all award information as required above. Per inquiry of the Treasurer, the District does not review audit reports of the subrecipient for any noted deficiencies. The District should implement procedures to verify that all required reviews and any additional required follow ups are completed and accurately documented. Further, the District should ensure all required information is included in the subrecipient agreement. We recommend that the District request copies of annual audit reports of the subrecipient to review the report for any potential deficiencies.
Criteria: 2 CFR 200.332(b)(1) requires every subaward to include required information and is clearly identified. Condition: Review of the agreements with three subrecipients identified certain communications required were not included in the language of the agreement. Cause: The Center was not aware of the information that is required to be included in the subaward agreement. Effect: The Center was not in compliance with 2 CFR 200.332(b)(1). Questioned Costs: None Recommendation: Management should review and refine its subaward agreements to include the necessary information as required by 2 CFR 200.332(b)(1). Views of Responsible Officials: Management agrees with the finding; see corrective action plan.
Reference Number: 2024-006 – Subrecipient Monitoring Federal Program Title: WIOA Cluster Federal Assistance Listing Number: 17.258 BWC Federal Agency: Department of Labor (DOL) Pass-Through Entity: State of California Employment Development Department Federal Award Number and Year: AA211079 Fiscal Year 2023-2024 Category of Finding: Subrecipient Monitoring Type of Finding: Material Weakness in Internal Control over Compliance, Instance of Noncompliance Criteria In accordance with Title 2 U.S. Code of Federal Regulations (CFR) § 200.332, all pass-through entities (PTE) 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. (b) Evaluate each subrecipient's risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring described in paragraphs (d) and (e) of this section. (c) 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. (d) 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. Condition During our audit of compliance with subrecipient monitoring, we noted that for one (1) subrecipient agreement, the agreement did not include one or more of the required elements defined in 2 CFR § 200.332 (a)(1) in the subrecipient’s agreement. For the same one (1) subrecipient, the Organization did not perform the risk assessment procedures defined in 2 CFR § 200.332 (b) or verify that the subrecipient should be audited as defined in 2 CFR § 200.332 (d). Cause Due to significant turnover in key personnel in the Organization’s finance department and management in past years, the Organization has no documented policies and procedures for subrecipient monitoring. Effect Not providing sufficient documentation to auditors to demonstrate compliance with federal compliance results in an audit scope limitation. Failure to provide all the required subaward information may result in subrecipients incorrectly reporting on federal pass-through awards in their Single Audit reports. Failure to document subrecipient risk assessment and verifying the subrecipient audit requirement result in noncompliance with the subrecipient monitoring requirements 2 CFR § 200.332. Questioned Costs Questioned costs were not determinable. Context For one (1) subrecipient selected for testing, with total expenditures of $325,977, from a population of one (1) subrecipient, the Company did not communicate all of the required subaward data elements, did not perform subrecipient risk assessment, and did not verify if subrecipient received audit. The sample was not a statistically valid sample. Recommendation We recommend that the Organization perform the following: (1) Develop procedures for future subrecipient agreements to ensure agreements will include all the required elements of 2 CFR § 200.332 (a)(1). (2) For existing subrecipients that were not provided the required elements, provide a letter or amended agreement to include all the required elements of 2 CFR § 200.332 (a)(1). (3) Maintain sufficient records of subrecipient risk assessment and monitoring subrecipients in accordance with subrecipient monitoring requirements noted in 2 CFR § 200.332 (b) – (d). Views of Responsible Officials and Planned Corrective Action Person responsible: Leona Smith Di Faustino, Interim Executive Director Corrective Action Plan: The Organization will update its subrecipient monitoring policies to ensure all required elements as defined in 2 CFR § 200.332 (a)(1) are included in subrecipient agreements, Additionally, a checklist will be established to perform a risk assessment process to evaluate subrecipient risk prior to contract execution and annually thereafter and to verify each subrecipient’s that meets the audit threshold and if required has a current Single Audit on file or is otherwise in compliance. Anticipated Implementation Date: July 1, 2025
Dairy Business Innovation Initiatives—Subrecipient Monitoring Background: During FY 2023-24, UW-Madison expended $9.9 million in federal funds for the DBII grant, which is administered by the U.S. Department of Agriculture. This grant program was first authorized in 2018, and UW-Madison has received annual awards for the program since 2019. UW-Madison subawarded approximately 60.0 percent of each DBII award it received to a subrecipient. The subrecipient’s primary function was to award grants to farmers or dairy processors to diversify farming activities, create value-added products, or enhance dairy export programs. Criteria: Under 2 CFR s. 200.332 (e), UW-Madison is required to monitor the activities of a subrecipient as necessary to ensure the subrecipient complies with federal statutes, regulations, and the terms and conditions of the subaward. Additionally, under 2 CFR s. 200.332 (f), pass-through entities must verify that a subrecipient is audited as required by 2 CFR Part 200 Subpart F, which requires that certain entities expending $750,000 or more of federal funds during a year have a single audit performed. UW Madison’s Research and Sponsored Programs (RSP) is responsible for monitoring subrecipient audit requirements prior to entering into contracts. As part of fulfilling its requirements under 2 CFR s. 200.332 (d), RSP requires subrecipients to complete an annual audit certification and provide a copy of its single audit, if applicable. Condition: We identified from UW Madison’s expenditures that it made payments to the DBII subrecipient of more than $750,000 during FY 2022-23 and, therefore, the subrecipient should have been subject to a single audit. However, UW Madison did not sufficiently monitor the subrecipient during FY 2023 24 to ensure the subrecipient was audited as required by 2 CFR s. 200.332 (f). The subrecipient did not have a FY 2022-23 single audit performed. Context: UW Madison made payments totaling $6.3 million to the DBII subrecipient during FY 2023 24 with a similar amount provided in the prior fiscal year. We reviewed the April 2024 annual audit certification submitted by the subrecipient, which included whether the subrecipient had completed a single audit for FY 2022 23. We searched the federal audit clearinghouse to determine whether the DBII subrecipient had submitted a single audit report. After we raised the issue, UW Madison contacted the subrecipient. UW-Madison indicated to us that the subrecipient had misunderstood the requirements. Questioned Costs: None. Effect: Without adequate monitoring, there is an increased risk of unallowable costs being charged to the DBII grant, or other noncompliance with federal regulations. Cause: RSP did not adequately evaluate the annual audit certification provided by the DBII subrecipient or perform other procedures to identify that an audit was required for the subrecipient. Recommendation: We recommend the University of Wisconsin Madison update its procedures for reviewing annual audit certifications received from subrecipients to include reviewing its expenditures with a subrecipient or other procedures to assist it in assessing subrecipient responses. Finding 2024-701: Dairy Business Innovation Initiatives—Subrecipient Monitoring Dairy Business Innovation Initiatives (Assistance Listing number 10.176) Award Numbers Award Years AM200100XXXXG001 2020 21DBIWI1006 2021 AM21DBIWI1010 2022 AM22DBIWI1014 2022 23DBIWI1019 2023 Questioned Costs: None Type of Finding: Significant Deficiency, Noncompliance Response from the University of Wisconsin-Madison: The University of Wisconsin-Madison agrees with the audit finding and recommendation.
Supplemental Nutrition Assistance Program—Subrecipient Monitoring Background: The USDA provides funding to DHS for the Supplemental Nutrition Assistance Program (SNAP) Cluster, which provides funding for SNAP benefits (Assistance Listing number 10.551). These SNAP benefits assist low-income households to buy the food needed for good health. The SNAP Cluster also provides funding for the State Administrative Matching Grants for SNAP (Assistance Listing number 10.561), which is used to pay administrative costs related to the provision and oversight of benefits. To administer the SNAP program, DHS contracts with ten multi-county income maintenance consortia, which are made up of county staff. These income maintenance consortia are responsible for a variety of administrative tasks, including program enrollment and caseload management, and are required to meet certain performance measures specified in the contract. DHS uses GEARS to process the reimbursement requests for these consortia, which are considered subrecipients. Criteria: DHS administers federal programs that are subject to Uniform Guidance. Uniform Guidance includes the following requirements related to the monitoring of subrecipients: -2 CFR s. 200.332 (b) requires DHS to evaluate each subrecipient’s risk of noncompliance for purposes of determining the appropriate nature and level of subrecipient monitoring; and -2 CFR s. 200.332 (d) through (f) requires DHS to monitor the activities of the subrecipient as necessary to ensure that the subrecipient uses the subaward for authorized purposes, complies with the terms and conditions of the subaward, and achieves performance goals. DHS established policies requiring grant administrators to conduct a risk assessment for every subaward of federal funds and to use the risk assessment to determine the frequency and extent of monitoring. DHS policies include a subrecipient risk assessment template to assist grant administrators in completing the risk assessment and determining the risk level of the subrecipient. DHS policies also require grant administrators to monitor subrecipients based on the risk assessments. DHS policies indicate that monitoring may include providing subrecipient training and technical assistance; performing desk reviews of the subrecipient’s records; and performing on-site reviews of the subrecipient’s records and operations. Condition: We found DHS did not perform the required risk assessments for the income maintenance consortia in FY 2020-21, FY 2021-22, FY 2022-23, and FY 2023-24. In addition, DHS did not define the level of monitoring to be performed based on the completed risk assessments. For example, there was no documentation to indicate the level monitoring required for low-, moderate-, and high-risk subrecipients, including the reliance that could be placed on the review of subrecipient single audit reports and whether additional fiscal monitoring such as a review of financial information to assess the allowability of reimbursement requests would be needed. DHS did perform monitoring procedures for each income maintenance consortia related to the contractual performance measures, including standards for timely processing of applications. DHS also performed annual management evaluations related to specific topics. Context: DHS expended $105.7 million in federal funds to administer the SNAP program during FY 2023-24, including $61.3 million that was provided to subrecipients, of which $37.5 million was provided to the income maintenance consortia agencies for program administration. We interviewed DHS staff to gain an understanding of DHS policies and procedures for processing reimbursement requests from subrecipients and its policies and procedures for monitoring subrecipients to ensure the subaward was used for authorized purposes, complied with the terms and conditions of the subaward, and achieved performance goals. Questioned Costs: None. Effect: Because its subrecipient monitoring procedures were insufficient, and because DHS did not perform any required risk assessments in the last four fiscal years, DHS is at increased risk of noncompliance with federal regulations for the SNAP program. Further, there is an increased risk of improper payments for the SNAP program. Cause: DHS did not complete the required risk assessments or develop and document a plan related to the monitoring necessary for each level of subrecipient risk. Although DHS performed certain monitoring related to contractual performance measures, these procedures were not part of a documented monitoring plan and there was no assessment of additional procedures that could have been determined necessary based upon the risk assessments. Recommendation: We recommend the Wisconsin Department of Health Services: -complete risk assessments for each income maintenance consortia receiving administrative funding under the Supplemental Nutrition Assistance Program; -develop and document a written monitoring plan that includes a description of the monitoring expected for low-, moderate-, and high-risk subrecipients to ensure that the subrecipient uses the subaward for authorized purposes, complies with the terms and conditions of the subaward, and achieves performance goals; -specify in the written monitoring plan how existing monitoring procedures are incorporated into the plan and assess what additional monitoring procedures may be needed; and -implement the written monitoring plan and maintain documentation related to the monitoring performed. Finding 2024-308: Supplemental Nutrition Assistance Program—Subrecipient Monitoring State Administrative Matching Grants for the Supplemental Nutrition Assistance Program (Assistance Listing number 10.561) Award Numbers Award Years 2WI400115 2023 2WI400115 2024 Questioned Costs: None Type of Finding: Significant Deficiency, Noncompliance Response from the Wisconsin Department of Health Services: The Wisconsin Department of Health Services agrees with the audit finding and recommendations.
Geographic Programs - Great Lakes Restoration Initiative—Subrecipient Monitoring Background: DNR receives federal funding from the EPA for the GLRI program. The objective of the GLRI program is to advance protection and restoration of the Great Lakes Basin Ecosystem through the funding of various projects. To administer the GLRI program, DNR contracts with subrecipients located around the State, including counties, cities, and sewage districts. During our FY 2022-23 single audit (report 24-3), we identified that DNR did not perform subrecipient risk assessments or have a plan to monitor subrecipients for the GLRI program based on the risk assessments. Further, DNR did not have sufficient procedures in place to ensure all GLRI subrecipient single audit reports were being obtained and reviewed. We recommended that DNR develop a written monitoring plan for the GLRI program that includes policies and procedures for: -completing risk assessments for each subrecipient; -the specific monitoring steps that are required based on the level of subrecipient risk identified in a risk assessment; -independently identifying and reviewing subrecipient single audit reports, if applicable; and -maintaining documentation of all subrecipient monitoring activities (Finding 2023-800). During FY 2023-24, and in response to our recommendations, DNR developed policies and procedures for monitoring and performing risk assessments of the GLRI subrecipients. In addition, DNR developed procedures to ensure GLRI subrecipient single audit reports were being obtained and reviewed. DNR completed its review of these reports in May 2024. Criteria: DNR administers federal programs that are subject to the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Uniform Guidance includes three requirements related to the monitoring of subrecipients. First, 2 CFR s. 200.332 (a) (1) requires DNR to communicate certain award information to subrecipients at the time of the subaward. Second, 2 CFR s. 200.332 (b) requires DNR to evaluate each subrecipient’s risk of noncompliance for purposes of determining the appropriate nature and level of subrecipient monitoring. Finally, 2 CFR s. 200.332 (d) through (f) requires DNR to monitor the activities of the subrecipient as necessary to ensure that the subrecipient uses the subaward for authorized purposes, complies with the terms and conditions of the subaward, and achieves performance goals. An EPA subaward policy further clarifies that the Uniform Guidance provisions are applicable to its grant programs, including a requirement for DNR to establish and follow a system for evaluating the risks of subrecipient noncompliance with laws, regulations, and the terms and conditions of the subaward, as required by 2 CFR ss. 200.332 (b) and (d). This policy also requires DNR to document its evaluations. In addition, EPA’s policy requires that DNR establish and follow a process for deciding whether to impose additional requirements on subrecipients based on the risk assessments. Condition: In response to our FY 2023-24 recommendation, in June 2024 DNR developed policies and procedures for monitoring GLRI subrecipients, including procedures for completing a risk assessment for each GLRI subrecipient and ranking each subrecipient based on the risk assessment to determine the level of monitoring needed. However, DNR did not complete risk assessments for any of its GLRI subrecipients during FY 2023-24. Context: DNR expended $15.5 million under the GLRI program during FY 2023-24, including $4.0 million that it provided to 21 subrecipients. We interviewed DNR staff to gain an understanding of its procedures for monitoring subrecipients. We reviewed the agreements between DNR and the subrecipients to identify whether DNR had communicated the required award information to them. We also reviewed monitoring activities DNR performed for the GLRI program, including DNR’s process to review subrecipient single audit reports and DNR’s monitoring of subrecipients through progress reporting and reimbursement requests. Finally, we reviewed and discussed with DNR staff the new procedures for completing subrecipient risk assessments. Questioned Costs: None. Effect: Because DNR did not comply with all subrecipient monitoring compliance requirements for the GLRI program, there is a higher risk that DNR and its GLRI subrecipients are not in compliance with all federal requirements. Cause: Although DNR developed policies and procedures for monitoring and performing risk assessments for the GLRI subrecipients, it did not complete risk assessments for the GLRI subrecipients during FY 2023-24. DNR indicated it would implement its policies and procedures for monitoring and performing risk assessments for the GLRI subrecipients as new subawards are created in FY 2024-25. However, DNR should also perform risk assessments for existing GLRI subrecipients to ensure its monitoring of the activities for ongoing GLRI projects is appropriate. Recommendation: We recommend the Wisconsin Department of Natural Resources implement its new monitoring policies and procedures for completing risk assessments for each subrecipient of the Geographic Programs - Great Lakes Restoration Initiative program, including for all its existing subrecipients for ongoing projects. Finding 2024-801: Geographic Programs - Great Lakes Restoration Initiative—Subrecipient Monitoring Geographic Programs - Great Lakes Restoration Initiative (Assistance Listing number 66.469) Award Numbers Award Years 00E02349 2018 00E02393 2018 00E02456 2019 00E02490 2019 00E02824 2020 00E02975 2021 00E02979 2021 00E03010 2021 03E00712 2022 01E03010 2022 00E03149 2022 00E03250 2022 00E03252 2022 00E03490 2023 00E03486 2023 00E03589 2023 Questioned Costs: None Type of Finding: Significant Deficiency, Noncompliance Response from the Wisconsin Department of Natural Resources: The Wisconsin Department of Natural Resources agrees with the audit finding and recommendation.
Epidemiology and Laboratory Capacity for Infectious Diseases (ELC)—Subrecipient Monitoring Background: The U.S. Department of Health and Human Services, Centers for Disease Control and Prevention (CDC) provides funding to DHS under the ELC grant. The ELC grant provides financial support and technical assistance to the State to detect, prevent, respond to, and control emerging infectious diseases. To administer the award under the ELC grant, DHS contracted with a variety of subrecipients, including local and tribal public health agencies and nonprofit entities. DHS uses GEARS to process the reimbursement requests for the majority of subrecipients. Criteria: DHS administers federal programs that are subject to the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Uniform Guidance includes the following requirements related to the monitoring of subrecipients: -2 CFR s. 200.332 (b) requires DHS to evaluate each subrecipient’s risk of noncompliance for purposes of determining the appropriate nature and level of subrecipient monitoring; and -2 CFR s. 200.332 (d) through (f) requires DHS to monitor the activities of the subrecipient as necessary to ensure that the subrecipient uses the subaward for authorized purposes, complies with the terms and conditions of the subaward, and achieves performance goals. DHS established policies requiring grant administrators to conduct a risk assessment for every subaward of federal funds and to use the risk assessment to determine the frequency and extent of monitoring. DHS policies include a subrecipient risk assessment template to assist grant administrators in completing the risk assessment and determining the risk level of the subrecipient. DHS policies also require grant administrators to monitor subrecipients based on the risk assessments. DHS policies indicate that monitoring may include providing subrecipient training and technical assistance; performing desk reviews of the subrecipient’s records; and performing on-site reviews of the subrecipient’s records and operations. Finally, DHS policies in the Division of Public Health Bureau of Operations Contract Management Manual suggest that when GEARS is used to process reimbursement requests, grant administrators should use enhanced expenditure reporting from subrecipients to ensure expenditures are allowable. These policies note that additional verification may be performed by reviewing subrecipient financial records through a desk review or an on-site visit. Condition: DHS did not complete subrecipient risk assessments for two tribal governments that were subrecipients of the ELC grant. In addition, DHS did not define the level of monitoring to be performed based on the completed risk assessments. There was no documentation to indicate the level of monitoring required for low-, moderate-, and high-risk subrecipients, such as when DHS would be required to review subrecipient invoices through a desk review or an on-site visit. Further, DHS did not develop procedures for assessing and documenting desk reviews of subrecipient invoices, for assessing and documenting the reliance that can be placed on review of subrecipient single audit reports, and for documenting management oversight of the monitoring plan. Context: DHS expended $46.9 million under the ELC grant during FY 2023-24, including $9.1 million that was provided to subrecipients. Of the $9.1 million provided to subrecipients, $4.8 million was processed through GEARS. In FY 2023-24 DHS provided funding to 73 subrecipients to administer the program, including six tribal governments. We interviewed DHS staff to gain an understanding of DHS policies and procedures for processing reimbursement requests from subrecipients, including its use of GEARS and DHS policies and procedures for monitoring subrecipients. Questioned Costs: None. Effect: Because its subrecipient monitoring procedures are insufficient, DHS is at increased risk of noncompliance with federal regulations for the ELC grant. There is also an increased risk of improper payments for the ELC grant. Cause: DHS staff noted that turnover in staff responsible for completion of risk assessments for tribal public health departments contributed to the risk assessments not being completed. DHS Division of Public Health established an internal control checklist for subrecipient monitoring in order to help guide staff in completing subrecipient monitoring, including prompts for staff to establish monitoring steps required for low-, moderate-, and high-risk subrecipients. However, this checklist was not implemented until July 2024. Recommendation: We recommend the Wisconsin Department of Health Services: -develop a written monitoring plan for the Epidemiology and Laboratory Capacity for Infectious Diseases grant that includes a description of the subrecipient monitoring expected for low-, moderate-, and high-risk subrecipients; procedures for completing and documenting desk reviews of subrecipient invoices; and procedures for assessing and documenting the reliance that can be placed on review of subrecipient single audit reports; -provide training on the monitoring plan to staff with responsibilities for subrecipient monitoring activities; and -develop and implement management oversight procedures to ensure monitoring is being completed and documented. Finding 2024-305: Epidemiology and Laboratory Capacity for Infectious Diseases (ELC)—Subrecipient Monitoring Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) (Assistance Listing number 93.323) Award Number Award Years NU50CK000534 2019-2024 Questioned Costs: None COVID-19—Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) (Assistance Listing number 93.323) Award Number Award Years NU50CK000534 2019-2024 Questioned Costs: None Type of Finding: Significant Deficiency, Noncompliance Response from the Wisconsin Department of Health Services: The Wisconsin Department of Health Services agrees with the audit finding and recommendations.
Epidemiology and Laboratory Capacity for Infectious Diseases (ELC)—Subrecipient Monitoring Background: The U.S. Department of Health and Human Services, Centers for Disease Control and Prevention (CDC) provides funding to DHS under the ELC grant. The ELC grant provides financial support and technical assistance to the State to detect, prevent, respond to, and control emerging infectious diseases. To administer the award under the ELC grant, DHS contracted with a variety of subrecipients, including local and tribal public health agencies and nonprofit entities. DHS uses GEARS to process the reimbursement requests for the majority of subrecipients. Criteria: DHS administers federal programs that are subject to the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Uniform Guidance includes the following requirements related to the monitoring of subrecipients: -2 CFR s. 200.332 (b) requires DHS to evaluate each subrecipient’s risk of noncompliance for purposes of determining the appropriate nature and level of subrecipient monitoring; and -2 CFR s. 200.332 (d) through (f) requires DHS to monitor the activities of the subrecipient as necessary to ensure that the subrecipient uses the subaward for authorized purposes, complies with the terms and conditions of the subaward, and achieves performance goals. DHS established policies requiring grant administrators to conduct a risk assessment for every subaward of federal funds and to use the risk assessment to determine the frequency and extent of monitoring. DHS policies include a subrecipient risk assessment template to assist grant administrators in completing the risk assessment and determining the risk level of the subrecipient. DHS policies also require grant administrators to monitor subrecipients based on the risk assessments. DHS policies indicate that monitoring may include providing subrecipient training and technical assistance; performing desk reviews of the subrecipient’s records; and performing on-site reviews of the subrecipient’s records and operations. Finally, DHS policies in the Division of Public Health Bureau of Operations Contract Management Manual suggest that when GEARS is used to process reimbursement requests, grant administrators should use enhanced expenditure reporting from subrecipients to ensure expenditures are allowable. These policies note that additional verification may be performed by reviewing subrecipient financial records through a desk review or an on-site visit. Condition: DHS did not complete subrecipient risk assessments for two tribal governments that were subrecipients of the ELC grant. In addition, DHS did not define the level of monitoring to be performed based on the completed risk assessments. There was no documentation to indicate the level of monitoring required for low-, moderate-, and high-risk subrecipients, such as when DHS would be required to review subrecipient invoices through a desk review or an on-site visit. Further, DHS did not develop procedures for assessing and documenting desk reviews of subrecipient invoices, for assessing and documenting the reliance that can be placed on review of subrecipient single audit reports, and for documenting management oversight of the monitoring plan. Context: DHS expended $46.9 million under the ELC grant during FY 2023-24, including $9.1 million that was provided to subrecipients. Of the $9.1 million provided to subrecipients, $4.8 million was processed through GEARS. In FY 2023-24 DHS provided funding to 73 subrecipients to administer the program, including six tribal governments. We interviewed DHS staff to gain an understanding of DHS policies and procedures for processing reimbursement requests from subrecipients, including its use of GEARS and DHS policies and procedures for monitoring subrecipients. Questioned Costs: None. Effect: Because its subrecipient monitoring procedures are insufficient, DHS is at increased risk of noncompliance with federal regulations for the ELC grant. There is also an increased risk of improper payments for the ELC grant. Cause: DHS staff noted that turnover in staff responsible for completion of risk assessments for tribal public health departments contributed to the risk assessments not being completed. DHS Division of Public Health established an internal control checklist for subrecipient monitoring in order to help guide staff in completing subrecipient monitoring, including prompts for staff to establish monitoring steps required for low-, moderate-, and high-risk subrecipients. However, this checklist was not implemented until July 2024. Recommendation: We recommend the Wisconsin Department of Health Services: -develop a written monitoring plan for the Epidemiology and Laboratory Capacity for Infectious Diseases grant that includes a description of the subrecipient monitoring expected for low-, moderate-, and high-risk subrecipients; procedures for completing and documenting desk reviews of subrecipient invoices; and procedures for assessing and documenting the reliance that can be placed on review of subrecipient single audit reports; -provide training on the monitoring plan to staff with responsibilities for subrecipient monitoring activities; and -develop and implement management oversight procedures to ensure monitoring is being completed and documented. Finding 2024-305: Epidemiology and Laboratory Capacity for Infectious Diseases (ELC)—Subrecipient Monitoring Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) (Assistance Listing number 93.323) Award Number Award Years NU50CK000534 2019-2024 Questioned Costs: None COVID-19—Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) (Assistance Listing number 93.323) Award Number Award Years NU50CK000534 2019-2024 Questioned Costs: None Type of Finding: Significant Deficiency, Noncompliance Response from the Wisconsin Department of Health Services: The Wisconsin Department of Health Services agrees with the audit finding and recommendations.
Public Health Emergency Response: Cooperative Agreement for Emergency Response: Public Health Crisis Response—Subrecipient Monitoring Background: The CDC provides funding to DHS under the Public Health Emergency Response: Cooperative Agreement for Emergency Response: Public Health Crisis Response grant, which DHS refers to as the Public Health Emergency Response grant. The Public Health Emergency Response grant is intended to provide funding to rapidly respond to public health emergencies as identified by the CDC. DHS received three awards from the CDC to be funded by the Public Health Emergency Response grant: COVID Crisis Response, which ended during FY 2022-23; COVID Public Health Workforce; and Monkey Pox Crisis Response. Under the COVID Public Health Workforce award, DHS contracted with subrecipients, including local and tribal public health agencies and cooperative educational service agencies (CESAs), to administer the award. DHS uses GEARS to process the reimbursement requests for the local and tribal public health agencies. Reimbursement requests for CESAs are processed directly through STAR, the State’s accounting system, based upon review and approval of detailed invoices. Under the Monkey Pox Crisis Response award, DHS contracted with a nonprofit organization and local public health agencies to administer the award, and used GEARS to process reimbursement requests from the subrecipients. During our FY 2022-23 audit (report 24-3), we identified concerns with subrecipient monitoring for the Public Health Emergency Response grant and recommended DHS review the tracking spreadsheets and complete its assessment of progress and fiscal reports and consideration of unallowable costs, and return funding to the federal government for unallowable costs identified; develop a monitoring plan; develop a central location to maintain monitoring documentation; and provide sufficient training to staff administering the Public Health Emergency Response grant (Finding 2023-306). DHS agreed with our recommendations and noted specific steps in its corrective action plan to address the concerns. Criteria: DHS administers federal programs that are subject to Uniform Guidance, which includes the following requirements related to the monitoring of subrecipients: -2 CFR s. 200.332 (b) requires DHS to evaluate each subrecipient’s risk of noncompliance for purposes of determining the appropriate nature and level of subrecipient monitoring; and -2 CFR s. 200.332 (d) through (f) requires DHS to monitor the activities of the subrecipient as necessary to ensure that the subrecipient uses the subaward for authorized purposes, complies with the terms and conditions of the subaward, and achieves performance goals. DHS established policies requiring grant administrators to conduct a risk assessment for every subaward of federal funds and to use the risk assessment to determine the frequency and extent of monitoring. DHS policies include a subrecipient risk assessment template to assist grant administrators in completing the risk assessment and determining the risk level of the subrecipient. DHS policies also require grant administrators to monitor subrecipients based on the risk assessments. DHS policies indicate that monitoring may include providing subrecipient training and technical assistance; performing desk reviews of the subrecipient’s records; and performing on-site reviews of the subrecipient’s records and operations. Finally, DHS policies in the Division of Public Health Bureau of Operations Contract Management Manual suggest that when GEARS is used to process reimbursement requests, grant administrators should use enhanced expenditure reporting from subrecipients to ensure expenditures are allowable. These policies note that additional verification may be performed by reviewing subrecipient financial records through a desk review or an on-site visit. Condition: In response to our prior year recommendation, DHS developed an internal control checklist for subrecipient monitoring, established a central location for filing monitoring documentation, and provided training to remind staff of their responsibilities related to subrecipient monitoring. However, the internal control checklist was implemented through a DHS, Division of Health, Bureau of Operations policy in July 2024, and we continued to identify concerns with subrecipient monitoring during FY 2023-24. We found that DHS did not provide documentation that it completed subrecipient risk assessments for three local public health agencies and seven tribal public health agencies that were subrecipients under the Public Health Emergency Response grant and had a contract modification in FY 2023-24. Further, DHS staff indicated that subrecipient risk assessments were not completed for seven of the nine tribal public health agencies when they were first subgranted funding in FY 2021-22. In addition, DHS did not define the level of monitoring to be performed based on the completed risk assessments. For example, there was no documentation to indicate the level of monitoring required for low-, moderate-, and high-risk subrecipients, such as when it would be required to review subrecipient invoices through a desk review or an on-site visit. Further, DHS did not develop procedures for assessing and documenting desk reviews of subrecipient invoices, for assessing and documenting the reliance that can be placed on review of subrecipient single audit reports, and for documenting management oversight of the monitoring plan. Finally, DHS did not address the prior year recommendation regarding incomplete information and the identification of potential unallowable costs on the FY 2022-23 tracking spreadsheets. Context: DHS expended $14.7 million under the Public Health Emergency Response grant during FY 2023-24, including $8.3 million that was provided to subrecipients. Of the $8.3 million provided to subrecipients, $3.5 million was processed through GEARS. We interviewed DHS staff to gain an understanding of DHS policies and procedures for processing reimbursement requests from subrecipients, including its use of GEARS; DHS policies and procedures for monitoring subrecipients; and the steps taken to address our prior year recommendations. For the COVID Public Health Workforce award, DHS contracted with 79 local and tribal public health agencies and 12 CESAs to administer the award. For the Monkey Pox Crisis Response award, DHS contracted with three subrecipients to administer the award. Questioned Costs: None. Effect: Because its subrecipient monitoring procedures are insufficient, DHS is at increased risk of noncompliance with federal regulations for the Public Health Emergency Response grant. There is also an increased risk of improper payments for the Public Health Emergency Response grant. Cause: Although DHS implemented some new subrecipient monitoring procedures and provided training to staff on subrecipient monitoring activities, it continued to have deficiencies in its procedures and monitoring of subrecipients for the Public Health Emergency Response grant during FY 2023-24. DHS indicated it continued to review and update its procedures in FY 2024-25. Recommendation: We recommend the Wisconsin Department of Health Services: -complete its review of the FY 2022-23 subrecipient tracking spreadsheets and complete the assessment of the progress and fiscal reports and consideration of unallowable costs, document the conclusion, and return funding to the federal government if costs were determined to be unallowable; -complete risk assessments for the three local and seven tribal public health agencies receiving funding under the Public Health Emergency Response grant during FY 2023-24 and adjust subrecipient monitoring appropriately; -continue to develop a written monitoring plan for the Public Health Emergency Response grant that includes a description of the subrecipient monitoring expected for low-, moderate-, and high-risk subrecipients; procedures for completing and documenting desk reviews of subrecipient invoices; and procedures for assessing and documenting the reliance that can be placed on review of subrecipient single audit reports; -provide training on the monitoring plan to staff with responsibilities for subrecipient monitoring activities; and -develop and implement management oversight procedures to ensure monitoring is being completed and documented. Finding 2024-307: Public Health Emergency Response: Cooperative Agreement for Emergency Response: Public Health Crisis Response—Subrecipient Monitoring Public Health Emergency Response: Cooperative Agreement for Emergency Response: Public Health Crisis Response (Assistance Listing number 93.354) Award Number Award Year 6 NU90TP922227-01 2023 Questioned Costs: None COVID-19—Public Health Emergency Response: Cooperative Agreement for Emergency Response: Public Health Crisis Response (Assistance Listing number 93.354) Award Numbers Award Years 6 NU90TP922078-01 2020 6 NU90TP922132-01 2021 Questioned Costs: None Type of Finding: Significant Deficiency, Noncompliance Response from the Wisconsin Department of Health Services: The Wisconsin Department of Health Services agrees with the audit finding and recommendations.
Public Health Emergency Response: Cooperative Agreement for Emergency Response: Public Health Crisis Response—Subrecipient Monitoring Background: The CDC provides funding to DHS under the Public Health Emergency Response: Cooperative Agreement for Emergency Response: Public Health Crisis Response grant, which DHS refers to as the Public Health Emergency Response grant. The Public Health Emergency Response grant is intended to provide funding to rapidly respond to public health emergencies as identified by the CDC. DHS received three awards from the CDC to be funded by the Public Health Emergency Response grant: COVID Crisis Response, which ended during FY 2022-23; COVID Public Health Workforce; and Monkey Pox Crisis Response. Under the COVID Public Health Workforce award, DHS contracted with subrecipients, including local and tribal public health agencies and cooperative educational service agencies (CESAs), to administer the award. DHS uses GEARS to process the reimbursement requests for the local and tribal public health agencies. Reimbursement requests for CESAs are processed directly through STAR, the State’s accounting system, based upon review and approval of detailed invoices. Under the Monkey Pox Crisis Response award, DHS contracted with a nonprofit organization and local public health agencies to administer the award, and used GEARS to process reimbursement requests from the subrecipients. During our FY 2022-23 audit (report 24-3), we identified concerns with subrecipient monitoring for the Public Health Emergency Response grant and recommended DHS review the tracking spreadsheets and complete its assessment of progress and fiscal reports and consideration of unallowable costs, and return funding to the federal government for unallowable costs identified; develop a monitoring plan; develop a central location to maintain monitoring documentation; and provide sufficient training to staff administering the Public Health Emergency Response grant (Finding 2023-306). DHS agreed with our recommendations and noted specific steps in its corrective action plan to address the concerns. Criteria: DHS administers federal programs that are subject to Uniform Guidance, which includes the following requirements related to the monitoring of subrecipients: -2 CFR s. 200.332 (b) requires DHS to evaluate each subrecipient’s risk of noncompliance for purposes of determining the appropriate nature and level of subrecipient monitoring; and -2 CFR s. 200.332 (d) through (f) requires DHS to monitor the activities of the subrecipient as necessary to ensure that the subrecipient uses the subaward for authorized purposes, complies with the terms and conditions of the subaward, and achieves performance goals. DHS established policies requiring grant administrators to conduct a risk assessment for every subaward of federal funds and to use the risk assessment to determine the frequency and extent of monitoring. DHS policies include a subrecipient risk assessment template to assist grant administrators in completing the risk assessment and determining the risk level of the subrecipient. DHS policies also require grant administrators to monitor subrecipients based on the risk assessments. DHS policies indicate that monitoring may include providing subrecipient training and technical assistance; performing desk reviews of the subrecipient’s records; and performing on-site reviews of the subrecipient’s records and operations. Finally, DHS policies in the Division of Public Health Bureau of Operations Contract Management Manual suggest that when GEARS is used to process reimbursement requests, grant administrators should use enhanced expenditure reporting from subrecipients to ensure expenditures are allowable. These policies note that additional verification may be performed by reviewing subrecipient financial records through a desk review or an on-site visit. Condition: In response to our prior year recommendation, DHS developed an internal control checklist for subrecipient monitoring, established a central location for filing monitoring documentation, and provided training to remind staff of their responsibilities related to subrecipient monitoring. However, the internal control checklist was implemented through a DHS, Division of Health, Bureau of Operations policy in July 2024, and we continued to identify concerns with subrecipient monitoring during FY 2023-24. We found that DHS did not provide documentation that it completed subrecipient risk assessments for three local public health agencies and seven tribal public health agencies that were subrecipients under the Public Health Emergency Response grant and had a contract modification in FY 2023-24. Further, DHS staff indicated that subrecipient risk assessments were not completed for seven of the nine tribal public health agencies when they were first subgranted funding in FY 2021-22. In addition, DHS did not define the level of monitoring to be performed based on the completed risk assessments. For example, there was no documentation to indicate the level of monitoring required for low-, moderate-, and high-risk subrecipients, such as when it would be required to review subrecipient invoices through a desk review or an on-site visit. Further, DHS did not develop procedures for assessing and documenting desk reviews of subrecipient invoices, for assessing and documenting the reliance that can be placed on review of subrecipient single audit reports, and for documenting management oversight of the monitoring plan. Finally, DHS did not address the prior year recommendation regarding incomplete information and the identification of potential unallowable costs on the FY 2022-23 tracking spreadsheets. Context: DHS expended $14.7 million under the Public Health Emergency Response grant during FY 2023-24, including $8.3 million that was provided to subrecipients. Of the $8.3 million provided to subrecipients, $3.5 million was processed through GEARS. We interviewed DHS staff to gain an understanding of DHS policies and procedures for processing reimbursement requests from subrecipients, including its use of GEARS; DHS policies and procedures for monitoring subrecipients; and the steps taken to address our prior year recommendations. For the COVID Public Health Workforce award, DHS contracted with 79 local and tribal public health agencies and 12 CESAs to administer the award. For the Monkey Pox Crisis Response award, DHS contracted with three subrecipients to administer the award. Questioned Costs: None. Effect: Because its subrecipient monitoring procedures are insufficient, DHS is at increased risk of noncompliance with federal regulations for the Public Health Emergency Response grant. There is also an increased risk of improper payments for the Public Health Emergency Response grant. Cause: Although DHS implemented some new subrecipient monitoring procedures and provided training to staff on subrecipient monitoring activities, it continued to have deficiencies in its procedures and monitoring of subrecipients for the Public Health Emergency Response grant during FY 2023-24. DHS indicated it continued to review and update its procedures in FY 2024-25. Recommendation: We recommend the Wisconsin Department of Health Services: -complete its review of the FY 2022-23 subrecipient tracking spreadsheets and complete the assessment of the progress and fiscal reports and consideration of unallowable costs, document the conclusion, and return funding to the federal government if costs were determined to be unallowable; -complete risk assessments for the three local and seven tribal public health agencies receiving funding under the Public Health Emergency Response grant during FY 2023-24 and adjust subrecipient monitoring appropriately; -continue to develop a written monitoring plan for the Public Health Emergency Response grant that includes a description of the subrecipient monitoring expected for low-, moderate-, and high-risk subrecipients; procedures for completing and documenting desk reviews of subrecipient invoices; and procedures for assessing and documenting the reliance that can be placed on review of subrecipient single audit reports; -provide training on the monitoring plan to staff with responsibilities for subrecipient monitoring activities; and -develop and implement management oversight procedures to ensure monitoring is being completed and documented. Finding 2024-307: Public Health Emergency Response: Cooperative Agreement for Emergency Response: Public Health Crisis Response—Subrecipient Monitoring Public Health Emergency Response: Cooperative Agreement for Emergency Response: Public Health Crisis Response (Assistance Listing number 93.354) Award Number Award Year 6 NU90TP922227-01 2023 Questioned Costs: None COVID-19—Public Health Emergency Response: Cooperative Agreement for Emergency Response: Public Health Crisis Response (Assistance Listing number 93.354) Award Numbers Award Years 6 NU90TP922078-01 2020 6 NU90TP922132-01 2021 Questioned Costs: None Type of Finding: Significant Deficiency, Noncompliance Response from the Wisconsin Department of Health Services: The Wisconsin Department of Health Services agrees with the audit finding and recommendations.
Activities to Support State, Tribal, Local and Territorial (STLT) Health Department Response to Public Health or Healthcare Crises—Subrecipient Monitoring Background: The CDC provides funding to DHS under the Activities to Support State, Tribal, Local and Territorial (STLT) Health Department Response to Public Health or Healthcare Crises grant, which DHS refers to as the Health Disparities grant. The grant is intended to address health disparities for high-risk and underserved populations to address COVID-19 related health disparities and advance health equity. To administer the award under the Health Disparities grant, DHS contracted with a variety of subrecipients, including local and tribal public health agencies and nonprofit entities. DHS uses GEARS to process the reimbursement requests for the majority of its subrecipients. During our FY 2022-23 audit (report 24-3), we identified concerns with subrecipient monitoring for the Health Disparities grant and recommended DHS develop a monitoring plan, develop a central location to maintain monitoring documentation, and provide sufficient training to staff administering the Health Disparities grant (Finding 2023-305). DHS agreed with our recommendation and noted specific steps in its corrective action plan to address the concerns. Criteria: DHS administers federal programs that are subject to Uniform Guidance, which includes the following requirements related to the monitoring of subrecipients: -2 CFR s. 200.332 (b) requires DHS to evaluate each subrecipient’s risk of noncompliance for purposes of determining the appropriate nature and level of subrecipient monitoring; and -2 CFR s. 200.332 (d) through (f) requires DHS to monitor the activities of the subrecipient as necessary to ensure that the subrecipient uses the subaward for authorized purposes, complies with the terms and conditions of the subaward, and achieves performance goals. DHS established policies requiring grant administrators to conduct a risk assessment for every subaward of federal funds and to use the risk assessment to determine the frequency and extent of monitoring. DHS policies include a subrecipient risk assessment template to assist grant administrators in completing the risk assessment and determining the risk level of the subrecipient. DHS policies also require grant administrators to monitor subrecipients based on the risk assessments. DHS policies indicate that monitoring may include providing subrecipient training and technical assistance; performing desk reviews of the subrecipient’s records; and performing on-site reviews of the subrecipient’s records and operations. Finally, DHS policies in the Division of Public Health Bureau of Operations Contract Management Manual suggest that when GEARS is used to process reimbursement requests, grant administrators should use enhanced expenditure reporting from subrecipients to ensure expenditures are allowable. These policies note that additional verification may be performed by reviewing subrecipient financial records through a desk review or an on-site visit. Condition: In response to our prior year recommendation, DHS developed an internal control checklist for subrecipient monitoring, established a central location for filing monitoring documentation, and provided training to remind staff of their responsibilities related to subrecipient monitoring. However, the internal control checklist was implemented through a DHS, Division of Public Health, Bureau of Operations policy in July 2024, and we continued to identify concerns with subrecipient monitoring during FY 2023-24. We found that DHS did not define the level of monitoring to be performed based on the completed risk assessments. For example, there was no documentation to indicate the level of monitoring required for low-, moderate-, and high-risk subrecipients, such as when it would be required to review subrecipient invoices through a desk review or an on-site visit. Further, DHS did not develop procedures for assessing and documenting desk reviews of subrecipient invoices, for assessing and documenting the reliance that can be placed on review of subrecipient single audit reports, and for documenting management oversight of the monitoring plan. Context: DHS expended $7.9 million under the Health Disparities grant during FY 2023-24, including $2.6 million that was provided to subrecipients. Of the $2.6 million provided to subrecipients, $2.4 million was processed through GEARS. DHS contracted with 87 subrecipients to administer the grant. We interviewed DHS staff to gain an understanding of DHS policies and procedures for processing reimbursement requests from subrecipients, including its use of GEARS; DHS policies and procedures for monitoring subrecipients; and the steps taken to address our prior year recommendations. Questioned Costs: None. Effect: Because its subrecipient monitoring procedures are insufficient, DHS is at increased risk of noncompliance with federal regulations for the Health Disparities grant. There is also an increased risk of improper payments for the Health Disparities grant. Cause: Although DHS implemented some new subrecipient monitoring procedures and provided training to staff on subrecipient monitoring activities, it continued to have deficiencies in its procedures and monitoring of subrecipients for the Health Disparities grant during FY 2023-24. DHS indicated it continued to review and update its procedures in FY 2024-25. Recommendation: We recommend the Wisconsin Department of Health Services: -continue to develop a written monitoring plan for the Health Disparities grant that includes a description of the subrecipient monitoring expected for low-, moderate-, and high-risk subrecipients; procedures for completing and documenting desk reviews of subrecipient invoices; and procedures for assessing and documenting the reliance that can be placed on review of subrecipient single audit reports; -provide training on the monitoring plan to staff with responsibilities for subrecipient monitoring activities; and -develop and implement management oversight procedures to ensure monitoring is being completed and documented. Finding 2024-306: Activities to Support State, Tribal, Local and Territorial (STLT) Health Department Response to Public Health or Healthcare Crises—Subrecipient Monitoring COVID-19—Activities to Support State, Tribal, Local and Territorial (STLT) Health Department Response to Public Health or Healthcare Crises (Assistance Listing number 93.391) Award Numbers Award Years 1 NH75OT000039-01-00 2021 6 NH75OT000039-01-03 2023 6 NH75OT000039-01-05 2024 Questioned Costs: None Type of Finding: Significant Deficiency, Noncompliance Response from the Wisconsin Department of Health Services: The Wisconsin Department of Health Services agrees with the audit finding and recommendations.
Social Services Block Grant—Subrecipient Contracts Background: DHHS provides funding to DHS for SSBG. This program provides flexible financial assistance to states that allows them to tailor social services programs to the needs of their populations. In addition, a state may transfer funds received under the Temporary Assistance for Needy Families (TANF) program (Assistance Listing number 93.558) to the SSBG program for use under this program. During FY 2023-24, $14.7 million was transferred from the TANF program to the SSBG program. DHS uses the SSBG funding, including the amounts transferred from the TANF program and general purpose revenue, to provide funding for the community aids program, and more specifically, amounts designated within this program as the “basic county allocation” that can be used by counties to support any eligible service. DHS contracts with each county for the administration of the community aids program. Because DHS provides funding to counties to carry out the purpose of a federal program, DHS is considered a pass-through entity, and the counties are considered subrecipients. DHS uses its Grant Enrollment, Application and Reporting System (GEARS) and establishes GEARS profiles to designate the program, the purpose of the program, the types of costs that will be reimbursed, and the federal programs that are used in funding the amount of the contract. The information provided to the counties for a GEARS profile will include the federal assistance listing number, as appropriate, and other required information. The counties use the GEARS profile established for the basic county allocation when determining the costs that can be funded and in requesting reimbursement for costs incurred. As part of our FY 2022-23 audit (report 24-3), we reported that DHS identified both the SSBG and TANF programs as providing funding for the basic county allocation. Because the TANF funds transferred to SSBG are subject to the SSBG requirements, the information DHS provided to the counties inaccurately identified the TANF program as a funding source for the basic county allocation. We recommended DHS update its procedures for contract development to ensure the information provided in its subrecipient contracts identified SSBG as the federal funding source for the basic county allocation of the community aids program related to the transferred TANF funds (Finding 2023-301). Criteria: Under 2 CFR s. 200.332, the pass-through entity is required to clearly identify to the subrecipient certain information that allows the subrecipient to understand the federal requirements related to the funding provided. This information includes providing the federal assistance listing number and the amount being provided under the assistance listing number. Under 42 USC s. 604, the transfer of funds from the TANF program to the SSBG program is allowed. Once transferred, the funding is no longer considered TANF funding and is subject to the SSBG requirements. The expenditures incurred with the transferred TANF funds would be considered an expenditure of SSBG. Condition: For calendar year 2024 contracts with each county for the administration of the community aids program, DHS identified that both the SSBG and TANF programs were being used to provide funding for the basic county allocation. Although the TANF funds transferred to SSBG are subject to the SSBG requirements, the information DHS provided to the counties, which included the assistance listing number, inaccurately identified the TANF program as a funding source for the basic county allocation. Because the contracts for calendar year 2024 were entered into prior to the communication of our finding for FY 2022-23 (Finding 2023-301), it was not unexpected to find contracts that continued to identify the incorrect assistance listing number. Context: During FY 2023-24, DHS expended $33.3 million in SSBG funds, which included transferred TANF funds, and subawarded $32.3 million. We reviewed 8 of the 72 county contracts that were executed during FY 2023-24 and discussed with DHS staff the steps taken in response to our finding for FY 2022-23 (Finding 2023-301). Questioned Costs: None. Effect: Because the contracts with the counties did not accurately identify the transferred TANF funds as those from the SSBG program, the counties were not aware of the full amount of SSBG funds received and, as a result, may not be aware of the federal requirements related to this funding. This could result in the counties not complying with federal requirements related to the SSBG funding. Cause: In contract development, DHS separately identified the SSBG and transferred TANF funds used in funding the basic county allocation. This separation resulted in the error in identifying TANF as a funding source in the contracts with the counties for the basic county allocation. DHS indicated it has implemented our recommendation from FY 2022-23 (Finding 2023-301) and has updated procedures for contract development to ensure information provided in its subrecipient contracts identify SSBG as the federal funding source for the basic county allocation of the community aids program related to the transferred TANF funds. However, DHS did not complete contract amendments for the calendar year 2024 contracts. Recommendation: We recommend the Wisconsin Department of Health Services implement its updated procedures for contract development to ensure information provided in its subrecipient contracts correctly identifies the Social Services Block Grant as the federal funding source for the basic county allocation of the community aids program related to the transferred Temporary Assistance for Needy Families funds. Finding 2024-302: Social Services Block Grant—Subrecipient Contracts Social Services Block Grant (Assistance Listing number 93.667) Award Numbers Award Years 2401WISOSR 2024 2301WISOSR 2023 Questioned Costs: None Type of Finding: Significant Deficiency, Noncompliance Response from the Wisconsin Department of Health Services: The Wisconsin Department of Health Services agrees with the audit finding and recommendation.
Geographic Programs - Great Lakes Restoration Initiative—Subrecipient Monitoring Background: DNR receives federal funding from the EPA for the GLRI program. The objective of the GLRI program is to advance protection and restoration of the Great Lakes Basin Ecosystem through the funding of various projects. To administer the GLRI program, DNR contracts with subrecipients located around the State, including counties, cities, and sewage districts. During our FY 2022-23 single audit (report 24-3), we identified that DNR did not perform subrecipient risk assessments or have a plan to monitor subrecipients for the GLRI program based on the risk assessments. Further, DNR did not have sufficient procedures in place to ensure all GLRI subrecipient single audit reports were being obtained and reviewed. We recommended that DNR develop a written monitoring plan for the GLRI program that includes policies and procedures for: -completing risk assessments for each subrecipient; -the specific monitoring steps that are required based on the level of subrecipient risk identified in a risk assessment; -independently identifying and reviewing subrecipient single audit reports, if applicable; and -maintaining documentation of all subrecipient monitoring activities (Finding 2023-800). During FY 2023-24, and in response to our recommendations, DNR developed policies and procedures for monitoring and performing risk assessments of the GLRI subrecipients. In addition, DNR developed procedures to ensure GLRI subrecipient single audit reports were being obtained and reviewed. DNR completed its review of these reports in May 2024. Criteria: DNR administers federal programs that are subject to the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Uniform Guidance includes three requirements related to the monitoring of subrecipients. First, 2 CFR s. 200.332 (a) (1) requires DNR to communicate certain award information to subrecipients at the time of the subaward. Second, 2 CFR s. 200.332 (b) requires DNR to evaluate each subrecipient’s risk of noncompliance for purposes of determining the appropriate nature and level of subrecipient monitoring. Finally, 2 CFR s. 200.332 (d) through (f) requires DNR to monitor the activities of the subrecipient as necessary to ensure that the subrecipient uses the subaward for authorized purposes, complies with the terms and conditions of the subaward, and achieves performance goals. An EPA subaward policy further clarifies that the Uniform Guidance provisions are applicable to its grant programs, including a requirement for DNR to establish and follow a system for evaluating the risks of subrecipient noncompliance with laws, regulations, and the terms and conditions of the subaward, as required by 2 CFR ss. 200.332 (b) and (d). This policy also requires DNR to document its evaluations. In addition, EPA’s policy requires that DNR establish and follow a process for deciding whether to impose additional requirements on subrecipients based on the risk assessments. Condition: In response to our FY 2023-24 recommendation, in June 2024 DNR developed policies and procedures for monitoring GLRI subrecipients, including procedures for completing a risk assessment for each GLRI subrecipient and ranking each subrecipient based on the risk assessment to determine the level of monitoring needed. However, DNR did not complete risk assessments for any of its GLRI subrecipients during FY 2023-24. Context: DNR expended $15.5 million under the GLRI program during FY 2023-24, including $4.0 million that it provided to 21 subrecipients. We interviewed DNR staff to gain an understanding of its procedures for monitoring subrecipients. We reviewed the agreements between DNR and the subrecipients to identify whether DNR had communicated the required award information to them. We also reviewed monitoring activities DNR performed for the GLRI program, including DNR’s process to review subrecipient single audit reports and DNR’s monitoring of subrecipients through progress reporting and reimbursement requests. Finally, we reviewed and discussed with DNR staff the new procedures for completing subrecipient risk assessments. Questioned Costs: None. Effect: Because DNR did not comply with all subrecipient monitoring compliance requirements for the GLRI program, there is a higher risk that DNR and its GLRI subrecipients are not in compliance with all federal requirements. Cause: Although DNR developed policies and procedures for monitoring and performing risk assessments for the GLRI subrecipients, it did not complete risk assessments for the GLRI subrecipients during FY 2023-24. DNR indicated it would implement its policies and procedures for monitoring and performing risk assessments for the GLRI subrecipients as new subawards are created in FY 2024-25. However, DNR should also perform risk assessments for existing GLRI subrecipients to ensure its monitoring of the activities for ongoing GLRI projects is appropriate. Recommendation: We recommend the Wisconsin Department of Natural Resources implement its new monitoring policies and procedures for completing risk assessments for each subrecipient of the Geographic Programs - Great Lakes Restoration Initiative program, including for all its existing subrecipients for ongoing projects. Finding 2024-801: Geographic Programs - Great Lakes Restoration Initiative—Subrecipient Monitoring Geographic Programs - Great Lakes Restoration Initiative (Assistance Listing number 66.469) Award Numbers Award Years 00E02349 2018 00E02393 2018 00E02456 2019 00E02490 2019 00E02824 2020 00E02975 2021 00E02979 2021 00E03010 2021 03E00712 2022 01E03010 2022 00E03149 2022 00E03250 2022 00E03252 2022 00E03490 2023 00E03486 2023 00E03589 2023 Questioned Costs: None Type of Finding: Significant Deficiency, Noncompliance Response from the Wisconsin Department of Natural Resources: The Wisconsin Department of Natural Resources agrees with the audit finding and recommendation.
Criteria or specific requirement: Compliance: 2 CFR §200.332(a) - Requirements for Pass-Through Entities states, in part, that all pass-through entities must ensure that every subaward is clearly identified to the subrecipient as a subaward and includes 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. Control: Per 2 CFR Section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply 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). Condition: The City did not furnish all required information to subrecipients at the time the subawards were issued. Context: The City failed to obtain the required Unique Entity Identifier (UEI) from one out of five subrecipients tested and the Federal Award Identification Number (FAIN) from five out of five subrecipients tested in accordance with proper subrecipient monitoring procedures. Questioned costs: None. Cause: The City did not establish effective internal controls and procedures over subrecipient monitoring.Effect: Excluding required federal grant award information at the time of the subaward may cause subrecipients and their auditors to be uninformed about program-specific regulations that apply to the funds they receive. There is also the potential for subrecipients to have incomplete Schedules of Expenditures of Federal Awards (SEFA) in subrecipients’ Single Audit reports, and federal funds may not be properly audited at the subrecipient level in accordance with the Uniform Guidance.Recommendation: The City should review and enhance its internal controls and procedures to ensure that all required information is included in subawards at the time of issuance and maintained in subsequent modifications. Views of responsible officials: The City agrees with this finding. See separate Corrective Action Plan related to this finding.
Program Information: Home Investment Partnerships Program (ALN #14.239) and Coronavirus State and Local Fiscal Recovery Funds (ALN #21.027) Criteria: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and 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). Per 2 CFR section 200.332, the subaward is to clearly identify to the subrecipient required information, including identification that the award is a subaward by providing information described in 200.332 (b)(1); all requirements imposed by the Pass-through Entity (PTE) on the subrecipient so that the federal award is used in accordance with federal statutes, regulations; and the terms and conditions of the award; and any additional requirements that the PTE imposes on the subrecipient. Additionally, per 2 CFR section 200.332 (f), the Organization should verify that a subrecipient is audited as required. Condition: The subawards did not include the required federal provisions or list the assistance listing numbers. The Organization did not obtain the most recently available audit reports of subrecipients. Questioned Costs: None. Context: This condition occurred for 8 out of 8 subawards selected for testing. Cause: Insufficient internal control and administrative oversight. Effect or Potential Effect: The subrecipients may not be aware of certain award information in order to comply with federal statutes, regulations, and the terms and conditions of the award. Repeat Finding: No
Program Information: Home Investment Partnerships Program (ALN #14.239) and Coronavirus State and Local Fiscal Recovery Funds (ALN #21.027) Criteria: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and 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). Per 2 CFR section 200.332, the subaward is to clearly identify to the subrecipient required information, including identification that the award is a subaward by providing information described in 200.332 (b)(1); all requirements imposed by the Pass-through Entity (PTE) on the subrecipient so that the federal award is used in accordance with federal statutes, regulations; and the terms and conditions of the award; and any additional requirements that the PTE imposes on the subrecipient. Additionally, per 2 CFR section 200.332 (f), the Organization should verify that a subrecipient is audited as required. Condition: The subawards did not include the required federal provisions or list the assistance listing numbers. The Organization did not obtain the most recently available audit reports of subrecipients. Questioned Costs: None. Context: This condition occurred for 8 out of 8 subawards selected for testing. Cause: Insufficient internal control and administrative oversight. Effect or Potential Effect: The subrecipients may not be aware of certain award information in order to comply with federal statutes, regulations, and the terms and conditions of the award. Repeat Finding: No
Program Information: Home Investment Partnerships Program (ALN #14.239) and Coronavirus State and Local Fiscal Recovery Funds (ALN #21.027) Criteria: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and 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). Per 2 CFR section 200.332, the subaward is to clearly identify to the subrecipient required information, including identification that the award is a subaward by providing information described in 200.332 (b)(1); all requirements imposed by the Pass-through Entity (PTE) on the subrecipient so that the federal award is used in accordance with federal statutes, regulations; and the terms and conditions of the award; and any additional requirements that the PTE imposes on the subrecipient. Additionally, per 2 CFR section 200.332 (f), the Organization should verify that a subrecipient is audited as required. Condition: The subawards did not include the required federal provisions or list the assistance listing numbers. The Organization did not obtain the most recently available audit reports of subrecipients. Questioned Costs: None. Context: This condition occurred for 8 out of 8 subawards selected for testing. Cause: Insufficient internal control and administrative oversight. Effect or Potential Effect: The subrecipients may not be aware of certain award information in order to comply with federal statutes, regulations, and the terms and conditions of the award. Repeat Finding: No
Program Information: Home Investment Partnerships Program (ALN #14.239) and Coronavirus State and Local Fiscal Recovery Funds (ALN #21.027) Criteria: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and 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). Per 2 CFR section 200.332, the subaward is to clearly identify to the subrecipient required information, including identification that the award is a subaward by providing information described in 200.332 (b)(1); all requirements imposed by the Pass-through Entity (PTE) on the subrecipient so that the federal award is used in accordance with federal statutes, regulations; and the terms and conditions of the award; and any additional requirements that the PTE imposes on the subrecipient. Additionally, per 2 CFR section 200.332 (f), the Organization should verify that a subrecipient is audited as required. Condition: The subawards did not include the required federal provisions or list the assistance listing numbers. The Organization did not obtain the most recently available audit reports of subrecipients. Questioned Costs: None. Context: This condition occurred for 8 out of 8 subawards selected for testing. Cause: Insufficient internal control and administrative oversight. Effect or Potential Effect: The subrecipients may not be aware of certain award information in order to comply with federal statutes, regulations, and the terms and conditions of the award. Repeat Finding: No
2024-003 SUBRECIPIENT MONITORING Federal Program Information: Federal Agency and Program Name Federal Assistance Listing Number U.S. Department of Labor WIOA Cluster 17.258/17.259/17.278 Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).” Recipients must ensure that commercial organizations that are subrecipients under WIOA Title I and expend more than the minimum level specified in 2 CFR Part 200, Subpart F, have either an organization-wide audit conducted in accordance with 2 CFR Part 200 or a program-specific financial and compliance audit (20 CFR section 683.210). 2 CFR 200.332(b) requires that all pass-through entities must: Evaluate each subrecipient’s risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring described in paragraphs (d) and (e) of this section. Condition: The Board did not maintain documentation of monitoring procedures performed on its subrecipient during the fiscal year ended June 30, 2024. The Board obtained the subrecipient’s audit report; however documentation of review of the audit report and risk assessment procedures performed on the subrecipient were not maintained as evidence of subrecipient monitoring performed. Questioned Costs: Unknown Context: Total federal expenditures for the WIOA Cluster were $1,377,447 for the year ended June 30, 2024, which included $293,830 of expenditures to subrecipients. Cause: The Board adopted policies and procedures surrounding the subrecipient monitoring compliance requirements in February 2025; however, no documented evidence of subrecipient monitoring completed during the fiscal year ended June 30, 2024 could be provided. Effect: The Board is not in compliance with the federal statutes, regulations, and terms and conditions of the federal award. Recommendation: We recommend that the Board implement its recently adopted policies and procedures and commit the appropriate personnel to subrecipient monitoring to ensure that the Board is in compliance with all federal requirements. Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2024-003 SUBRECIPIENT MONITORING Federal Program Information: Federal Agency and Program Name Federal Assistance Listing Number U.S. Department of Labor WIOA Cluster 17.258/17.259/17.278 Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).” Recipients must ensure that commercial organizations that are subrecipients under WIOA Title I and expend more than the minimum level specified in 2 CFR Part 200, Subpart F, have either an organization-wide audit conducted in accordance with 2 CFR Part 200 or a program-specific financial and compliance audit (20 CFR section 683.210). 2 CFR 200.332(b) requires that all pass-through entities must: Evaluate each subrecipient’s risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring described in paragraphs (d) and (e) of this section. Condition: The Board did not maintain documentation of monitoring procedures performed on its subrecipient during the fiscal year ended June 30, 2024. The Board obtained the subrecipient’s audit report; however documentation of review of the audit report and risk assessment procedures performed on the subrecipient were not maintained as evidence of subrecipient monitoring performed. Questioned Costs: Unknown Context: Total federal expenditures for the WIOA Cluster were $1,377,447 for the year ended June 30, 2024, which included $293,830 of expenditures to subrecipients. Cause: The Board adopted policies and procedures surrounding the subrecipient monitoring compliance requirements in February 2025; however, no documented evidence of subrecipient monitoring completed during the fiscal year ended June 30, 2024 could be provided. Effect: The Board is not in compliance with the federal statutes, regulations, and terms and conditions of the federal award. Recommendation: We recommend that the Board implement its recently adopted policies and procedures and commit the appropriate personnel to subrecipient monitoring to ensure that the Board is in compliance with all federal requirements. Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2024-003 SUBRECIPIENT MONITORING Federal Program Information: Federal Agency and Program Name Federal Assistance Listing Number U.S. Department of Labor WIOA Cluster 17.258/17.259/17.278 Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).” Recipients must ensure that commercial organizations that are subrecipients under WIOA Title I and expend more than the minimum level specified in 2 CFR Part 200, Subpart F, have either an organization-wide audit conducted in accordance with 2 CFR Part 200 or a program-specific financial and compliance audit (20 CFR section 683.210). 2 CFR 200.332(b) requires that all pass-through entities must: Evaluate each subrecipient’s risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring described in paragraphs (d) and (e) of this section. Condition: The Board did not maintain documentation of monitoring procedures performed on its subrecipient during the fiscal year ended June 30, 2024. The Board obtained the subrecipient’s audit report; however documentation of review of the audit report and risk assessment procedures performed on the subrecipient were not maintained as evidence of subrecipient monitoring performed. Questioned Costs: Unknown Context: Total federal expenditures for the WIOA Cluster were $1,377,447 for the year ended June 30, 2024, which included $293,830 of expenditures to subrecipients. Cause: The Board adopted policies and procedures surrounding the subrecipient monitoring compliance requirements in February 2025; however, no documented evidence of subrecipient monitoring completed during the fiscal year ended June 30, 2024 could be provided. Effect: The Board is not in compliance with the federal statutes, regulations, and terms and conditions of the federal award. Recommendation: We recommend that the Board implement its recently adopted policies and procedures and commit the appropriate personnel to subrecipient monitoring to ensure that the Board is in compliance with all federal requirements. Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2024-003 SUBRECIPIENT MONITORING Federal Program Information: Federal Agency and Program Name Federal Assistance Listing Number U.S. Department of Labor WIOA Cluster 17.258/17.259/17.278 Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).” Recipients must ensure that commercial organizations that are subrecipients under WIOA Title I and expend more than the minimum level specified in 2 CFR Part 200, Subpart F, have either an organization-wide audit conducted in accordance with 2 CFR Part 200 or a program-specific financial and compliance audit (20 CFR section 683.210). 2 CFR 200.332(b) requires that all pass-through entities must: Evaluate each subrecipient’s risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring described in paragraphs (d) and (e) of this section. Condition: The Board did not maintain documentation of monitoring procedures performed on its subrecipient during the fiscal year ended June 30, 2024. The Board obtained the subrecipient’s audit report; however documentation of review of the audit report and risk assessment procedures performed on the subrecipient were not maintained as evidence of subrecipient monitoring performed. Questioned Costs: Unknown Context: Total federal expenditures for the WIOA Cluster were $1,377,447 for the year ended June 30, 2024, which included $293,830 of expenditures to subrecipients. Cause: The Board adopted policies and procedures surrounding the subrecipient monitoring compliance requirements in February 2025; however, no documented evidence of subrecipient monitoring completed during the fiscal year ended June 30, 2024 could be provided. Effect: The Board is not in compliance with the federal statutes, regulations, and terms and conditions of the federal award. Recommendation: We recommend that the Board implement its recently adopted policies and procedures and commit the appropriate personnel to subrecipient monitoring to ensure that the Board is in compliance with all federal requirements. Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2024-003 SUBRECIPIENT MONITORING Federal Program Information: Federal Agency and Program Name Federal Assistance Listing Number U.S. Department of Labor WIOA Cluster 17.258/17.259/17.278 Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).” Recipients must ensure that commercial organizations that are subrecipients under WIOA Title I and expend more than the minimum level specified in 2 CFR Part 200, Subpart F, have either an organization-wide audit conducted in accordance with 2 CFR Part 200 or a program-specific financial and compliance audit (20 CFR section 683.210). 2 CFR 200.332(b) requires that all pass-through entities must: Evaluate each subrecipient’s risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring described in paragraphs (d) and (e) of this section. Condition: The Board did not maintain documentation of monitoring procedures performed on its subrecipient during the fiscal year ended June 30, 2024. The Board obtained the subrecipient’s audit report; however documentation of review of the audit report and risk assessment procedures performed on the subrecipient were not maintained as evidence of subrecipient monitoring performed. Questioned Costs: Unknown Context: Total federal expenditures for the WIOA Cluster were $1,377,447 for the year ended June 30, 2024, which included $293,830 of expenditures to subrecipients. Cause: The Board adopted policies and procedures surrounding the subrecipient monitoring compliance requirements in February 2025; however, no documented evidence of subrecipient monitoring completed during the fiscal year ended June 30, 2024 could be provided. Effect: The Board is not in compliance with the federal statutes, regulations, and terms and conditions of the federal award. Recommendation: We recommend that the Board implement its recently adopted policies and procedures and commit the appropriate personnel to subrecipient monitoring to ensure that the Board is in compliance with all federal requirements. Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2024-003 SUBRECIPIENT MONITORING Federal Program Information: Federal Agency and Program Name Federal Assistance Listing Number U.S. Department of Labor WIOA Cluster 17.258/17.259/17.278 Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).” Recipients must ensure that commercial organizations that are subrecipients under WIOA Title I and expend more than the minimum level specified in 2 CFR Part 200, Subpart F, have either an organization-wide audit conducted in accordance with 2 CFR Part 200 or a program-specific financial and compliance audit (20 CFR section 683.210). 2 CFR 200.332(b) requires that all pass-through entities must: Evaluate each subrecipient’s risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring described in paragraphs (d) and (e) of this section. Condition: The Board did not maintain documentation of monitoring procedures performed on its subrecipient during the fiscal year ended June 30, 2024. The Board obtained the subrecipient’s audit report; however documentation of review of the audit report and risk assessment procedures performed on the subrecipient were not maintained as evidence of subrecipient monitoring performed. Questioned Costs: Unknown Context: Total federal expenditures for the WIOA Cluster were $1,377,447 for the year ended June 30, 2024, which included $293,830 of expenditures to subrecipients. Cause: The Board adopted policies and procedures surrounding the subrecipient monitoring compliance requirements in February 2025; however, no documented evidence of subrecipient monitoring completed during the fiscal year ended June 30, 2024 could be provided. Effect: The Board is not in compliance with the federal statutes, regulations, and terms and conditions of the federal award. Recommendation: We recommend that the Board implement its recently adopted policies and procedures and commit the appropriate personnel to subrecipient monitoring to ensure that the Board is in compliance with all federal requirements. Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2024-003 SUBRECIPIENT MONITORING Federal Program Information: Federal Agency and Program Name Federal Assistance Listing Number U.S. Department of Labor WIOA Cluster 17.258/17.259/17.278 Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).” Recipients must ensure that commercial organizations that are subrecipients under WIOA Title I and expend more than the minimum level specified in 2 CFR Part 200, Subpart F, have either an organization-wide audit conducted in accordance with 2 CFR Part 200 or a program-specific financial and compliance audit (20 CFR section 683.210). 2 CFR 200.332(b) requires that all pass-through entities must: Evaluate each subrecipient’s risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring described in paragraphs (d) and (e) of this section. Condition: The Board did not maintain documentation of monitoring procedures performed on its subrecipient during the fiscal year ended June 30, 2024. The Board obtained the subrecipient’s audit report; however documentation of review of the audit report and risk assessment procedures performed on the subrecipient were not maintained as evidence of subrecipient monitoring performed. Questioned Costs: Unknown Context: Total federal expenditures for the WIOA Cluster were $1,377,447 for the year ended June 30, 2024, which included $293,830 of expenditures to subrecipients. Cause: The Board adopted policies and procedures surrounding the subrecipient monitoring compliance requirements in February 2025; however, no documented evidence of subrecipient monitoring completed during the fiscal year ended June 30, 2024 could be provided. Effect: The Board is not in compliance with the federal statutes, regulations, and terms and conditions of the federal award. Recommendation: We recommend that the Board implement its recently adopted policies and procedures and commit the appropriate personnel to subrecipient monitoring to ensure that the Board is in compliance with all federal requirements. Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
Federal Agency: Department of Health and Human Services Federal Program Name: HeadStart Assistance Listing Number: 93.600 Federal Award Identification Number and Year: 03CH011220-04-00, 2023 03CH011220-05-00, 2024 Award Period: 9/1/2022-8/31/2023 9/1/2023-8/31/2024 Compliance Requirement: Subrecipient Monitoring Type of Finding: Material Weakness in Internal Control over Compliance, Material Noncompliance Criteria or Specific Requirement: Compliance: Per 2 CFR 200 § 200.332(a)1 (d) a non-Federal entity should 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. Internal Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply 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). Condition: The Department of Community and Human Services (DCHS) did not provide documentation to support monitoring of the subrecipient’s activities. Questioned Costs: None Context: DCHS has one sub awardee and issued a subaward in the amount of $2,822,089. Cause: DCHS’ procedures did not maintain supporting documentation of subrecipient monitoring activities. Effect: DCHS was unable to provide evidence they were in compliance with subrecipient monitoring requirements. Repeat Finding: No Recommendation: We recommend that DCHS enhance procedures to ensure that sub recipient monitoring activities are documented, and evidence of compliance readily available for review. Views of Responsible Officials: There is no disagreement with the audit finding and new personnel in the Department of Community and Human Services will ensure that all required monitoring is performed and documented in a timely manner.
Federal Agency: U.S. Department of Treasury Federal Program Name: Coronavirus State and Local Fiscal Recovery Funds (CSLFRF) Assistance Listing Number: 21.027 Type of Finding: Material Weakness in Internal Control Over Compliance, Material Noncompliance (Modified Opinion) Criteria: Per 2 CFR sections 200.332(d) through (f), a 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 the performance goals. Per 2 CFR section 200.502(a), the determination of when a Federal award is expended must be based on when the activity related to the Federal award occurs which is generally expenditure/expense transactions associated with awards. Condition: During our testing over subrecipient monitoring, the County was unable to provide subrecipient monitoring support. Questioned Costs: None Context: We selected 8 samples as part of our testing over Subrecipient Monitoring. Of the 8 samples selected, the County was unable to provide adequate support for the subrecipients selected. Cause: The County has policies that require departments to conduct subrecipient monitoring to ensure compliance with grant requirements. However, the policy does not include documentation of these monitoring activities, such as site visits, financial reviews, or performance evaluations. This lack of documentation results in an inability to verify that subrecipient monitoring is being performed effectively and consistently. Effect: Without proper oversight, subrecipients may fail to achieve program goals and objectives, leading to poor performance and outcomes for the funded programs. Repeat Finding: No Recommendation: We recommend that the County implement procedures to ensure that federal guidance is followed related to subrecipient monitoring and provide trainings on these procedures, including maintaining documentation of the review performed by the County. View of Responsible Officials: There is no disagreement with the audit finding.
Congressional Directives, ALN 93.493, U.S. Department of Health and Human Services Applicable Institution: University of Mississippi Medical Center (UMMC) Congressional Directives, ALN 95.010, Executive Office of the President Applicable Institution; University of Mississippi (UM) Program Year 2023-2024 Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Criteria or Specific Requirement – Subrecipient Monitoring (31 USC 7502(f)(2) (Single Audit Act Amendments of 1996 (Pub. L. No. 104-156)), 2 CFR sections 200.332, and 200.501(h); federal awarding agency regulations; and the terms and conditions of the award. Condition – The pass-through entity must identify the award and applicable requirements, including whether the grant is considered research and development (R&D). Subawards were made that identified the grants as R&D when they were not. Cause – The institution’s internal controls did not ensure the applicable requirements were communicated to the subrecipient. Effect or Potential Effect – The subaward was or could have been improperly classified as R&D on the subrecipients’ schedule of expenditures of federal awards. Questioned costs – None Context – ALN 93.493 - Out of 3 subrecipients, a sample of 1 was selected for testing, ALN 95.010 – Out of 7 subrecipients, a sample of 2 were selected for testing. Our sample was not, and was not intended to be, statistically valid. All awards tested communicated that the subaward was R&D. Identification as a Repeat Finding, if Applicable – N/A Recommendation – The institutions should update policies and procedures to ensure the award and applicable requirements are communicated to subrecipients. Views of Responsible Officials and Planned Corrective Actions – There is no disagreement with the audit finding. See corrective action plan.
Congressional Directives, ALN 93.493, U.S. Department of Health and Human Services Applicable Institution: University of Mississippi Medical Center (UMMC) Congressional Directives, ALN 95.010, Executive Office of the President Applicable Institution; University of Mississippi (UM) Program Year 2023-2024 Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Criteria or Specific Requirement – Subrecipient Monitoring (31 USC 7502(f)(2) (Single Audit Act Amendments of 1996 (Pub. L. No. 104-156)), 2 CFR sections 200.332, and 200.501(h); federal awarding agency regulations; and the terms and conditions of the award. Condition – The pass-through entity must identify the award and applicable requirements, including whether the grant is considered research and development (R&D). Subawards were made that identified the grants as R&D when they were not. Cause – The institution’s internal controls did not ensure the applicable requirements were communicated to the subrecipient. Effect or Potential Effect – The subaward was or could have been improperly classified as R&D on the subrecipients’ schedule of expenditures of federal awards. Questioned costs – None Context – ALN 93.493 - Out of 3 subrecipients, a sample of 1 was selected for testing, ALN 95.010 – Out of 7 subrecipients, a sample of 2 were selected for testing. Our sample was not, and was not intended to be, statistically valid. All awards tested communicated that the subaward was R&D. Identification as a Repeat Finding, if Applicable – N/A Recommendation – The institutions should update policies and procedures to ensure the award and applicable requirements are communicated to subrecipients. Views of Responsible Officials and Planned Corrective Actions – There is no disagreement with the audit finding. See corrective action plan.
SECTION III - FEDERAL AWARD FINDINGS AND QUESTIONED COSTS (Continued) Ref. No. 2024-005 Subrecipient Monitoring - Significant Deficiency Federal agency: Department of Treasury Pass-Through Entity: State of Hawaii Program: ALN No. 21.027 COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Repeat Finding? Yes; 2023-005 Criteria: Subrecipient monitoring and management requirements for pass-through entities at 2 CFR §200.332 - Requirements for pass-through entities require that the County: • Evaluate each subrecipient’s fraud risk and risk of noncompliance for purposes of determining the appropriate subrecipient monitoring related to the subaward [2 CFR § 200.332(c)]. • Verify that subrecipients are audited as required by 2 CFR Part 200, Subpart F - Audit Requirements if the entity expended $750,000 or more during the entity’s fiscal year [2 CFR § 200.332(g)]. As part of the County’s policies and procedures to evaluate subrecipient risk and to determine whether or not the subrecipient is subject to an audit as required by 2 CFR Part 200, Subpart F - Audit Requirements, subrecipients are required to complete the “Subrecipient Monitoring and Risk Assessment Form” which is to be submitted along with the subrecipient’s grant application or prior to the execution of the grant agreement, upon award. Condition: During our testing of the subrecipient monitoring compliance requirement, we discovered three (3) out of 3 samples tested where the County did not complete the Subrecipient Monitoring and Risk Assessment Form. Cause: The County did not follow its policies and procedures over subrecipient monitoring throughout the fiscal year. Effect: Completion of the Subrecipient Monitoring and Risk Assessment Form for subrecipients help ensure proper accountability and compliance with program requirements and achievement of performance goals. Questioned Cost: $ -- Recommendation We recommend the County follow its policies and procedures for its subrecipients to ensure proper monitoring activities are performed as required by 2 CFR §200.332 Views of Responsible Officials and Planned Corrective Action The County agrees with the finding and the recommendation. See Part IV Corrective Action Plan.
SECTION III - FEDERAL AWARD FINDINGS AND QUESTIONED COSTS (Continued) Ref. No. 2024-005 Subrecipient Monitoring - Significant Deficiency Federal agency: Department of Treasury Pass-Through Entity: State of Hawaii Program: ALN No. 21.027 COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Repeat Finding? Yes; 2023-005 Criteria: Subrecipient monitoring and management requirements for pass-through entities at 2 CFR §200.332 - Requirements for pass-through entities require that the County: • Evaluate each subrecipient’s fraud risk and risk of noncompliance for purposes of determining the appropriate subrecipient monitoring related to the subaward [2 CFR § 200.332(c)]. • Verify that subrecipients are audited as required by 2 CFR Part 200, Subpart F - Audit Requirements if the entity expended $750,000 or more during the entity’s fiscal year [2 CFR § 200.332(g)]. As part of the County’s policies and procedures to evaluate subrecipient risk and to determine whether or not the subrecipient is subject to an audit as required by 2 CFR Part 200, Subpart F - Audit Requirements, subrecipients are required to complete the “Subrecipient Monitoring and Risk Assessment Form” which is to be submitted along with the subrecipient’s grant application or prior to the execution of the grant agreement, upon award. Condition: During our testing of the subrecipient monitoring compliance requirement, we discovered three (3) out of 3 samples tested where the County did not complete the Subrecipient Monitoring and Risk Assessment Form. Cause: The County did not follow its policies and procedures over subrecipient monitoring throughout the fiscal year. Effect: Completion of the Subrecipient Monitoring and Risk Assessment Form for subrecipients help ensure proper accountability and compliance with program requirements and achievement of performance goals. Questioned Cost: $ -- Recommendation We recommend the County follow its policies and procedures for its subrecipients to ensure proper monitoring activities are performed as required by 2 CFR §200.332 Views of Responsible Officials and Planned Corrective Action The County agrees with the finding and the recommendation. See Part IV Corrective Action Plan.
SECTION III - FEDERAL AWARD FINDINGS AND QUESTIONED COSTS (Continued) Ref. No. 2024-005 Subrecipient Monitoring - Significant Deficiency Federal agency: Department of Treasury Pass-Through Entity: State of Hawaii Program: ALN No. 21.027 COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Repeat Finding? Yes; 2023-005 Criteria: Subrecipient monitoring and management requirements for pass-through entities at 2 CFR §200.332 - Requirements for pass-through entities require that the County: • Evaluate each subrecipient’s fraud risk and risk of noncompliance for purposes of determining the appropriate subrecipient monitoring related to the subaward [2 CFR § 200.332(c)]. • Verify that subrecipients are audited as required by 2 CFR Part 200, Subpart F - Audit Requirements if the entity expended $750,000 or more during the entity’s fiscal year [2 CFR § 200.332(g)]. As part of the County’s policies and procedures to evaluate subrecipient risk and to determine whether or not the subrecipient is subject to an audit as required by 2 CFR Part 200, Subpart F - Audit Requirements, subrecipients are required to complete the “Subrecipient Monitoring and Risk Assessment Form” which is to be submitted along with the subrecipient’s grant application or prior to the execution of the grant agreement, upon award. Condition: During our testing of the subrecipient monitoring compliance requirement, we discovered three (3) out of 3 samples tested where the County did not complete the Subrecipient Monitoring and Risk Assessment Form. Cause: The County did not follow its policies and procedures over subrecipient monitoring throughout the fiscal year. Effect: Completion of the Subrecipient Monitoring and Risk Assessment Form for subrecipients help ensure proper accountability and compliance with program requirements and achievement of performance goals. Questioned Cost: $ -- Recommendation We recommend the County follow its policies and procedures for its subrecipients to ensure proper monitoring activities are performed as required by 2 CFR §200.332 Views of Responsible Officials and Planned Corrective Action The County agrees with the finding and the recommendation. See Part IV Corrective Action Plan.
SECTION III - FEDERAL AWARD FINDINGS AND QUESTIONED COSTS (Continued) Ref. No. 2024-005 Subrecipient Monitoring - Significant Deficiency Federal agency: Department of Treasury Pass-Through Entity: State of Hawaii Program: ALN No. 21.027 COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Repeat Finding? Yes; 2023-005 Criteria: Subrecipient monitoring and management requirements for pass-through entities at 2 CFR §200.332 - Requirements for pass-through entities require that the County: • Evaluate each subrecipient’s fraud risk and risk of noncompliance for purposes of determining the appropriate subrecipient monitoring related to the subaward [2 CFR § 200.332(c)]. • Verify that subrecipients are audited as required by 2 CFR Part 200, Subpart F - Audit Requirements if the entity expended $750,000 or more during the entity’s fiscal year [2 CFR § 200.332(g)]. As part of the County’s policies and procedures to evaluate subrecipient risk and to determine whether or not the subrecipient is subject to an audit as required by 2 CFR Part 200, Subpart F - Audit Requirements, subrecipients are required to complete the “Subrecipient Monitoring and Risk Assessment Form” which is to be submitted along with the subrecipient’s grant application or prior to the execution of the grant agreement, upon award. Condition: During our testing of the subrecipient monitoring compliance requirement, we discovered three (3) out of 3 samples tested where the County did not complete the Subrecipient Monitoring and Risk Assessment Form. Cause: The County did not follow its policies and procedures over subrecipient monitoring throughout the fiscal year. Effect: Completion of the Subrecipient Monitoring and Risk Assessment Form for subrecipients help ensure proper accountability and compliance with program requirements and achievement of performance goals. Questioned Cost: $ -- Recommendation We recommend the County follow its policies and procedures for its subrecipients to ensure proper monitoring activities are performed as required by 2 CFR §200.332 Views of Responsible Officials and Planned Corrective Action The County agrees with the finding and the recommendation. See Part IV Corrective Action Plan.
SECTION III - FEDERAL AWARD FINDINGS AND QUESTIONED COSTS (Continued) Ref. No. 2024-005 Subrecipient Monitoring - Significant Deficiency Federal agency: Department of Treasury Pass-Through Entity: State of Hawaii Program: ALN No. 21.027 COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Repeat Finding? Yes; 2023-005 Criteria: Subrecipient monitoring and management requirements for pass-through entities at 2 CFR §200.332 - Requirements for pass-through entities require that the County: • Evaluate each subrecipient’s fraud risk and risk of noncompliance for purposes of determining the appropriate subrecipient monitoring related to the subaward [2 CFR § 200.332(c)]. • Verify that subrecipients are audited as required by 2 CFR Part 200, Subpart F - Audit Requirements if the entity expended $750,000 or more during the entity’s fiscal year [2 CFR § 200.332(g)]. As part of the County’s policies and procedures to evaluate subrecipient risk and to determine whether or not the subrecipient is subject to an audit as required by 2 CFR Part 200, Subpart F - Audit Requirements, subrecipients are required to complete the “Subrecipient Monitoring and Risk Assessment Form” which is to be submitted along with the subrecipient’s grant application or prior to the execution of the grant agreement, upon award. Condition: During our testing of the subrecipient monitoring compliance requirement, we discovered three (3) out of 3 samples tested where the County did not complete the Subrecipient Monitoring and Risk Assessment Form. Cause: The County did not follow its policies and procedures over subrecipient monitoring throughout the fiscal year. Effect: Completion of the Subrecipient Monitoring and Risk Assessment Form for subrecipients help ensure proper accountability and compliance with program requirements and achievement of performance goals. Questioned Cost: $ -- Recommendation We recommend the County follow its policies and procedures for its subrecipients to ensure proper monitoring activities are performed as required by 2 CFR §200.332 Views of Responsible Officials and Planned Corrective Action The County agrees with the finding and the recommendation. See Part IV Corrective Action Plan.
SECTION III - FEDERAL AWARD FINDINGS AND QUESTIONED COSTS (Continued) Ref. No. 2024-005 Subrecipient Monitoring - Significant Deficiency Federal agency: Department of Treasury Pass-Through Entity: State of Hawaii Program: ALN No. 21.027 COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Repeat Finding? Yes; 2023-005 Criteria: Subrecipient monitoring and management requirements for pass-through entities at 2 CFR §200.332 - Requirements for pass-through entities require that the County: • Evaluate each subrecipient’s fraud risk and risk of noncompliance for purposes of determining the appropriate subrecipient monitoring related to the subaward [2 CFR § 200.332(c)]. • Verify that subrecipients are audited as required by 2 CFR Part 200, Subpart F - Audit Requirements if the entity expended $750,000 or more during the entity’s fiscal year [2 CFR § 200.332(g)]. As part of the County’s policies and procedures to evaluate subrecipient risk and to determine whether or not the subrecipient is subject to an audit as required by 2 CFR Part 200, Subpart F - Audit Requirements, subrecipients are required to complete the “Subrecipient Monitoring and Risk Assessment Form” which is to be submitted along with the subrecipient’s grant application or prior to the execution of the grant agreement, upon award. Condition: During our testing of the subrecipient monitoring compliance requirement, we discovered three (3) out of 3 samples tested where the County did not complete the Subrecipient Monitoring and Risk Assessment Form. Cause: The County did not follow its policies and procedures over subrecipient monitoring throughout the fiscal year. Effect: Completion of the Subrecipient Monitoring and Risk Assessment Form for subrecipients help ensure proper accountability and compliance with program requirements and achievement of performance goals. Questioned Cost: $ -- Recommendation We recommend the County follow its policies and procedures for its subrecipients to ensure proper monitoring activities are performed as required by 2 CFR §200.332 Views of Responsible Officials and Planned Corrective Action The County agrees with the finding and the recommendation. See Part IV Corrective Action Plan.
SECTION III - FEDERAL AWARD FINDINGS AND QUESTIONED COSTS (Continued) Ref. No. 2024-005 Subrecipient Monitoring - Significant Deficiency Federal agency: Department of Treasury Pass-Through Entity: State of Hawaii Program: ALN No. 21.027 COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Repeat Finding? Yes; 2023-005 Criteria: Subrecipient monitoring and management requirements for pass-through entities at 2 CFR §200.332 - Requirements for pass-through entities require that the County: • Evaluate each subrecipient’s fraud risk and risk of noncompliance for purposes of determining the appropriate subrecipient monitoring related to the subaward [2 CFR § 200.332(c)]. • Verify that subrecipients are audited as required by 2 CFR Part 200, Subpart F - Audit Requirements if the entity expended $750,000 or more during the entity’s fiscal year [2 CFR § 200.332(g)]. As part of the County’s policies and procedures to evaluate subrecipient risk and to determine whether or not the subrecipient is subject to an audit as required by 2 CFR Part 200, Subpart F - Audit Requirements, subrecipients are required to complete the “Subrecipient Monitoring and Risk Assessment Form” which is to be submitted along with the subrecipient’s grant application or prior to the execution of the grant agreement, upon award. Condition: During our testing of the subrecipient monitoring compliance requirement, we discovered three (3) out of 3 samples tested where the County did not complete the Subrecipient Monitoring and Risk Assessment Form. Cause: The County did not follow its policies and procedures over subrecipient monitoring throughout the fiscal year. Effect: Completion of the Subrecipient Monitoring and Risk Assessment Form for subrecipients help ensure proper accountability and compliance with program requirements and achievement of performance goals. Questioned Cost: $ -- Recommendation We recommend the County follow its policies and procedures for its subrecipients to ensure proper monitoring activities are performed as required by 2 CFR §200.332 Views of Responsible Officials and Planned Corrective Action The County agrees with the finding and the recommendation. See Part IV Corrective Action Plan.
SECTION III - FEDERAL AWARD FINDINGS AND QUESTIONED COSTS (Continued) Ref. No. 2024-005 Subrecipient Monitoring - Significant Deficiency Federal agency: Department of Treasury Pass-Through Entity: State of Hawaii Program: ALN No. 21.027 COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Repeat Finding? Yes; 2023-005 Criteria: Subrecipient monitoring and management requirements for pass-through entities at 2 CFR §200.332 - Requirements for pass-through entities require that the County: • Evaluate each subrecipient’s fraud risk and risk of noncompliance for purposes of determining the appropriate subrecipient monitoring related to the subaward [2 CFR § 200.332(c)]. • Verify that subrecipients are audited as required by 2 CFR Part 200, Subpart F - Audit Requirements if the entity expended $750,000 or more during the entity’s fiscal year [2 CFR § 200.332(g)]. As part of the County’s policies and procedures to evaluate subrecipient risk and to determine whether or not the subrecipient is subject to an audit as required by 2 CFR Part 200, Subpart F - Audit Requirements, subrecipients are required to complete the “Subrecipient Monitoring and Risk Assessment Form” which is to be submitted along with the subrecipient’s grant application or prior to the execution of the grant agreement, upon award. Condition: During our testing of the subrecipient monitoring compliance requirement, we discovered three (3) out of 3 samples tested where the County did not complete the Subrecipient Monitoring and Risk Assessment Form. Cause: The County did not follow its policies and procedures over subrecipient monitoring throughout the fiscal year. Effect: Completion of the Subrecipient Monitoring and Risk Assessment Form for subrecipients help ensure proper accountability and compliance with program requirements and achievement of performance goals. Questioned Cost: $ -- Recommendation We recommend the County follow its policies and procedures for its subrecipients to ensure proper monitoring activities are performed as required by 2 CFR §200.332 Views of Responsible Officials and Planned Corrective Action The County agrees with the finding and the recommendation. See Part IV Corrective Action Plan.
Reference Number: 2024-002 Federal Program Title: Coronavirus State and Local Fiscal Recovery Funds Federal Assistance Listing Number: 21.027 Federal Agency: U.S. Department of Treasury Pass-Through Entity: N/A Federal Award Number and Year: Fiscal Year 2023-24 Name of Department: County Executive Office Department of Aging Department of Arts and Culture Department of Economic Opportunity Category of Finding: Subrecipient Monitoring Type of Finding: Material Weakness in Internal Control Over Compliance; Material Noncompliance Criteria In accordance with Title 2 U.S. Code of Federal Regulations (CFR) § 200.332(e), all pass-through entities (PTE) must: Monitor the activities of the subrecipient as necessary to ensure that the subrecipient complies with Federal statutes, regulations, and the terms and conditions of the subaward. The pass-through entity is responsible for monitoring the overall performance of a subrecipient to ensure that the goals and objectives of the subaward are achieved. In monitoring a subrecipient, a pass-through entity must: (1) Review financial and performance reports. (2) Ensure that the subrecipient takes corrective action on all significant developments that negatively affect the subaward. Significant developments include Single Audit findings related to the subaward, other audit findings, site visits, and written notification from a subrecipient of adverse conditions which will impact their ability to meet the milestones or the objectives of a subaward. When significant developments negatively impact the subaward, a subrecipient must provide the pass-through entity with information on their plan for corrective action and any assistance needed to resolve the situation. (3) Issue management decision for audit findings pertaining to only to the Federal award provided to the subrecipient from the pass-through entity as required by § 200.521. (4) Resolve audit findings specifically related to the subaward. However, the pass-through entity is not responsible for resolving cross-cutting audit findings that apply to the subaward and other Federal awards or subawards. If a subrecipient has a current Single Audit report and has not been excluded from receiving Federal funding (meaning, has not been debarred or suspended), the pass-through entity may rely on the subrecipient’s cognizant agency for audit or oversight agency for audit to perform audit follow-up and make management decisions related to cross-cutting audit findings in accordance with section § 200.513(a)(4)(viii). 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. Condition During our audit of the Coronavirus State and Local Fiscal Recovery Funds (CSLFRF) program, we selected fifteen (15) subrecipients with active contracts with the County during FY 2023-24. We noted for seven (7) contracts administered by the Departments of Aging, Arts and Culture, and Economic Opportunity, the departments did not perform subrecipient monitoring related to the CSLFRF program during FY 2023-24. This is a repeat finding of 2023-009. Cause Due to the urgency to implement the CSLFRF program, the departments needed more time to enter into contracts with independent CPA firms to monitor the CSLFRF subrecipients and document the reviews in accordance with subrecipient monitoring requirements. Effect Failure to document monitoring results in noncompliance with the subrecipient monitoring requirements 2 CFR § 200.332(e). Questioned Costs Questioned costs were not determinable. Context Of the fifteen (15) subrecipients selected for testing, which totaled $20,981,306, from a population of 76 subrecipients with expenditures totaling $101,950,949, the departments did not perform subrecipient monitoring for seven (7) subrecipients with expenditures totaling $19,118,116. The sample was not a statistically valid sample. Recommendation We recommend the County monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes and maintain sufficient records of monitoring subrecipients in accordance with subrecipient monitoring requirements.
Reference Number: 2024-002 Federal Program Title: Coronavirus State and Local Fiscal Recovery Funds Federal Assistance Listing Number: 21.027 Federal Agency: U.S. Department of Treasury Pass-Through Entity: N/A Federal Award Number and Year: Fiscal Year 2023-24 Name of Department: County Executive Office Department of Aging Department of Arts and Culture Department of Economic Opportunity Category of Finding: Subrecipient Monitoring Type of Finding: Material Weakness in Internal Control Over Compliance; Material Noncompliance Criteria In accordance with Title 2 U.S. Code of Federal Regulations (CFR) § 200.332(e), all pass-through entities (PTE) must: Monitor the activities of the subrecipient as necessary to ensure that the subrecipient complies with Federal statutes, regulations, and the terms and conditions of the subaward. The pass-through entity is responsible for monitoring the overall performance of a subrecipient to ensure that the goals and objectives of the subaward are achieved. In monitoring a subrecipient, a pass-through entity must: (1) Review financial and performance reports. (2) Ensure that the subrecipient takes corrective action on all significant developments that negatively affect the subaward. Significant developments include Single Audit findings related to the subaward, other audit findings, site visits, and written notification from a subrecipient of adverse conditions which will impact their ability to meet the milestones or the objectives of a subaward. When significant developments negatively impact the subaward, a subrecipient must provide the pass-through entity with information on their plan for corrective action and any assistance needed to resolve the situation. (3) Issue management decision for audit findings pertaining to only to the Federal award provided to the subrecipient from the pass-through entity as required by § 200.521. (4) Resolve audit findings specifically related to the subaward. However, the pass-through entity is not responsible for resolving cross-cutting audit findings that apply to the subaward and other Federal awards or subawards. If a subrecipient has a current Single Audit report and has not been excluded from receiving Federal funding (meaning, has not been debarred or suspended), the pass-through entity may rely on the subrecipient’s cognizant agency for audit or oversight agency for audit to perform audit follow-up and make management decisions related to cross-cutting audit findings in accordance with section § 200.513(a)(4)(viii). 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. Condition During our audit of the Coronavirus State and Local Fiscal Recovery Funds (CSLFRF) program, we selected fifteen (15) subrecipients with active contracts with the County during FY 2023-24. We noted for seven (7) contracts administered by the Departments of Aging, Arts and Culture, and Economic Opportunity, the departments did not perform subrecipient monitoring related to the CSLFRF program during FY 2023-24. This is a repeat finding of 2023-009. Cause Due to the urgency to implement the CSLFRF program, the departments needed more time to enter into contracts with independent CPA firms to monitor the CSLFRF subrecipients and document the reviews in accordance with subrecipient monitoring requirements. Effect Failure to document monitoring results in noncompliance with the subrecipient monitoring requirements 2 CFR § 200.332(e). Questioned Costs Questioned costs were not determinable. Context Of the fifteen (15) subrecipients selected for testing, which totaled $20,981,306, from a population of 76 subrecipients with expenditures totaling $101,950,949, the departments did not perform subrecipient monitoring for seven (7) subrecipients with expenditures totaling $19,118,116. The sample was not a statistically valid sample. Recommendation We recommend the County monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes and maintain sufficient records of monitoring subrecipients in accordance with subrecipient monitoring requirements.
2024-005 SUBRECIPIENT MONITORING Federal Agency: U.S. Department of Homeland Security/FEMA Federal Program Title & Assistance Listing Number: Disaster Grants – Public Assistance (Presidentially Declared Disasters) - 97.036 Emergency Management Performance Grants – 97.042 Homeland Security Grant Program – 97.067 Award Period: Various Type of Finding:Significant Deficiency in Internal Control over Compliance Other Non-compliance Condition: During our testing, we noted the Department did not have adequate internal controls in place to ensure compliance with subrecipient monitoring. . ALN 97.036, ALN 97.042, ALN 97.067 The Department lacked an effective process to timely provide documentation to the auditors which would evidence compliance with the Subrecipient Monitoring compliance requirement. This makes it difficult for management to monitor for compliance or for a third party to test compliance. All requested documentation was ultimate provided. ALN 97.036 o We reviewed files for 5 subrecipients, from which there were 16 ongoing projects during fiscal year 2024. Of these, 1 of 5 subrecipients did not have evidence that a risk assessment was performed. 2 of 5 subrecipients did not have adequate documentation of monitoring activities performed, including the Department's monitoring checklist. Management's Progress for Repeated Finding: Management made some progress in the performing of risk assessments and reviews of audits for non-disaster grants, but still has opportunity to improve controls in the areas described above. Criteria: According to §200.332 Requirements for pass-through entities of 2 CFR Part 200, all pass-through entities must evaluate each subrecipient's risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring. In addition, the pass-through entity must 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 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 §200.521 Management Decision. Department Policy No. GRA 418 Sub-Grant Recipient Monitoring effective June 30, 2017 establishes and implements policy and procedures for the Department staff engaged in the Department's sub- grant recipient monitoring process. For Mitigation Sub-Grant Monitoring, the Mitigation Specialist shall review the local progress quarterly reports due to the Department. For Non-Disaster Sub-Grant Recipient Monitoring, the Program Manager shall review the local progress quarterly reports due to the Department. Specific to Pre-Monitoring Requirements and Considerations, Department Program Staff shall perform risk-based assessments and apply the assessment to all of the Department's approved sub-recipients for monitoring purposes and risk designation.
2024-005 SUBRECIPIENT MONITORING Federal Agency: U.S. Department of Homeland Security/FEMA Federal Program Title & Assistance Listing Number: Disaster Grants – Public Assistance (Presidentially Declared Disasters) - 97.036 Emergency Management Performance Grants – 97.042 Homeland Security Grant Program – 97.067 Award Period: Various Type of Finding:Significant Deficiency in Internal Control over Compliance Other Non-compliance Condition: During our testing, we noted the Department did not have adequate internal controls in place to ensure compliance with subrecipient monitoring. . ALN 97.036, ALN 97.042, ALN 97.067 The Department lacked an effective process to timely provide documentation to the auditors which would evidence compliance with the Subrecipient Monitoring compliance requirement. This makes it difficult for management to monitor for compliance or for a third party to test compliance. All requested documentation was ultimate provided. ALN 97.036 o We reviewed files for 5 subrecipients, from which there were 16 ongoing projects during fiscal year 2024. Of these, 1 of 5 subrecipients did not have evidence that a risk assessment was performed. 2 of 5 subrecipients did not have adequate documentation of monitoring activities performed, including the Department's monitoring checklist. Management's Progress for Repeated Finding: Management made some progress in the performing of risk assessments and reviews of audits for non-disaster grants, but still has opportunity to improve controls in the areas described above. Criteria: According to §200.332 Requirements for pass-through entities of 2 CFR Part 200, all pass-through entities must evaluate each subrecipient's risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring. In addition, the pass-through entity must 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 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 §200.521 Management Decision. Department Policy No. GRA 418 Sub-Grant Recipient Monitoring effective June 30, 2017 establishes and implements policy and procedures for the Department staff engaged in the Department's sub- grant recipient monitoring process. For Mitigation Sub-Grant Monitoring, the Mitigation Specialist shall review the local progress quarterly reports due to the Department. For Non-Disaster Sub-Grant Recipient Monitoring, the Program Manager shall review the local progress quarterly reports due to the Department. Specific to Pre-Monitoring Requirements and Considerations, Department Program Staff shall perform risk-based assessments and apply the assessment to all of the Department's approved sub-recipients for monitoring purposes and risk designation.
2024-005 SUBRECIPIENT MONITORING Federal Agency: U.S. Department of Homeland Security/FEMA Federal Program Title & Assistance Listing Number: Disaster Grants – Public Assistance (Presidentially Declared Disasters) - 97.036 Emergency Management Performance Grants – 97.042 Homeland Security Grant Program – 97.067 Award Period: Various Type of Finding:Significant Deficiency in Internal Control over Compliance Other Non-compliance Condition: During our testing, we noted the Department did not have adequate internal controls in place to ensure compliance with subrecipient monitoring. . ALN 97.036, ALN 97.042, ALN 97.067 The Department lacked an effective process to timely provide documentation to the auditors which would evidence compliance with the Subrecipient Monitoring compliance requirement. This makes it difficult for management to monitor for compliance or for a third party to test compliance. All requested documentation was ultimate provided. ALN 97.036 o We reviewed files for 5 subrecipients, from which there were 16 ongoing projects during fiscal year 2024. Of these, 1 of 5 subrecipients did not have evidence that a risk assessment was performed. 2 of 5 subrecipients did not have adequate documentation of monitoring activities performed, including the Department's monitoring checklist. Management's Progress for Repeated Finding: Management made some progress in the performing of risk assessments and reviews of audits for non-disaster grants, but still has opportunity to improve controls in the areas described above. Criteria: According to §200.332 Requirements for pass-through entities of 2 CFR Part 200, all pass-through entities must evaluate each subrecipient's risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring. In addition, the pass-through entity must 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 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 §200.521 Management Decision. Department Policy No. GRA 418 Sub-Grant Recipient Monitoring effective June 30, 2017 establishes and implements policy and procedures for the Department staff engaged in the Department's sub- grant recipient monitoring process. For Mitigation Sub-Grant Monitoring, the Mitigation Specialist shall review the local progress quarterly reports due to the Department. For Non-Disaster Sub-Grant Recipient Monitoring, the Program Manager shall review the local progress quarterly reports due to the Department. Specific to Pre-Monitoring Requirements and Considerations, Department Program Staff shall perform risk-based assessments and apply the assessment to all of the Department's approved sub-recipients for monitoring purposes and risk designation.
Finding Reference Number: 2024-005 NH Fish and Game Department Fish and Wildlife Cluster (Assistance Listing #15.605, #15.611, #15.626) Federal Award Numbers: F22AF00995-00, F22AF00929-00, F23AF03086-00, F22AF00514-01, F22AF02616-02 Federal Award Year: 2022, 2023 U.S. Department of Interior Compliance Requirement: Subrecipient Monitoring Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: N/A Statistically Valid Sample: The sample was not intended to be, and was not, a statistically valid sample. Criteria A pass-through entity (PTE) must: 1. Identify the Award and Applicable Requirements - Clearly identify to the subrecipient required award information and applicable requirements described in 2 CFR section 200.332(a). 2. Evaluate Risk – 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)). 3. Monitor – 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: a. Reviewing financial and programmatic (performance and special reports) required by the PTE. b. 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. c. 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. 2 CFR 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide 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. This would include internal controls related to the cash management process. Condition During the year ended June 30, 2024, the New Hampshire Fish and Game Department (the Department) passed through $484,952 of federal funding to 1 subrecipient to fund 4 different projects. As part of our testwork related subrecipient monitoring, we identified the following: A. The Department communicates award information through the approved grant agreement. For 3 of 4 projects selected for testwork, the Department did not communicate all the required award information as outlined in 2 CFR 200.332(b). Specifically, the following elements were not communicated: • Subrecipient's unique entity identifier • Identification of whether the Federal award is for research and development B. As part of the during the award monitoring testwork, we noted that the Department completes a risk assessment questionnaire for all new projects they approve for the subrecipient. As part of our testwork over the risk assessments performed, we identified the following: • For 1 of 4 projects selected for testwork, there was no risk assessment questionnaire completed. • For 3 of 4 projects selected for testwork, a risk assessment questionnaire was completed, however there were no required monitoring procedures outlined within the questionnaire. As a result, we were not able to determine what monitoring procedures should have been performed over the projects as a result of the risk assessment. C. The Department’s during the award monitoring includes the review and approval of the subrecipient’s request for reimbursement. During our testwork over the review and approval of the request for reimbursement, we noted that for all 9 invoices selected for testwork, that while the invoice appeared to be properly reviewed and approved, the level of detail included within the invoice would not allow the Department to determine the reasonableness of the costs incurred to ensure that they were incurred in accordance with the grant agreement. D. The Department’s during the award monitoring includes obtaining a progress report related to each project that the subrecipient has been granted funding for. As part of our testwork, we identified that for all 4 projects selected for testwork, while a progress report was obtained, there was no evidence provided to support that the Department had reviewed the report. As a result, we were unable to determine based on the Department’s risk assessment procedures what the type and frequency of monitoring procedures that should have been performed over each project. E. The Department does not have formal policies and procedures to review and maintain documentation to evidence the review and approval of the subrecipient’s unform guidance report. There was no documentation to support that the Department had obtained and reviewed its subrecipient’s most recent uniform guidance report issued. Cause The cause of the condition found was primarily due to a lack of formal written policies and procedures and internal controls to ensure that all required subrecipient monitoring compliance procedures are being performed by the Department. Effect The effect of the condition found is that the Department did not comply with 2 CFR section 200.332(a), 2 CFR section 200.332(b), 2 CFR sections 200.332(d) through (f), and 2 CFR section 200.501(h). Questioned Costs: None. Recommendation We recommend the Department develop written policies and procedures and implement internal controls to ensure that the Department complies with 2 CFR section 200.332(a), 2 CFR section 200.332(b), 2 CFR sections 200.332(d) through (f), and 2 CFR section 200.501(h). This would ensure that all subrecipient grant agreements contains all required communications, that a risk assessment is performed that will outline the types and frequency of monitoring procedures to be performed, that all during the award monitoring activities are properly documented and that the receipt and review of the subrecipient’s uniform guidance report is properly documented. View of Responsible Officials: Management partially concurs with this finding. Rejoinder: As documented within the condition found, sufficient documentation was not provided to demonstrate that the Department complied with 2 CFR section 200.332(a), 2 CFR section 200.332(b), 2 CFR sections 200.332(d) through (f), and 2 CFR section 200.501(h).
Finding Reference Number: 2024-005 NH Fish and Game Department Fish and Wildlife Cluster (Assistance Listing #15.605, #15.611, #15.626) Federal Award Numbers: F22AF00995-00, F22AF00929-00, F23AF03086-00, F22AF00514-01, F22AF02616-02 Federal Award Year: 2022, 2023 U.S. Department of Interior Compliance Requirement: Subrecipient Monitoring Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: N/A Statistically Valid Sample: The sample was not intended to be, and was not, a statistically valid sample. Criteria A pass-through entity (PTE) must: 1. Identify the Award and Applicable Requirements - Clearly identify to the subrecipient required award information and applicable requirements described in 2 CFR section 200.332(a). 2. Evaluate Risk – 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)). 3. Monitor – 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: a. Reviewing financial and programmatic (performance and special reports) required by the PTE. b. 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. c. 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. 2 CFR 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide 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. This would include internal controls related to the cash management process. Condition During the year ended June 30, 2024, the New Hampshire Fish and Game Department (the Department) passed through $484,952 of federal funding to 1 subrecipient to fund 4 different projects. As part of our testwork related subrecipient monitoring, we identified the following: A. The Department communicates award information through the approved grant agreement. For 3 of 4 projects selected for testwork, the Department did not communicate all the required award information as outlined in 2 CFR 200.332(b). Specifically, the following elements were not communicated: • Subrecipient's unique entity identifier • Identification of whether the Federal award is for research and development B. As part of the during the award monitoring testwork, we noted that the Department completes a risk assessment questionnaire for all new projects they approve for the subrecipient. As part of our testwork over the risk assessments performed, we identified the following: • For 1 of 4 projects selected for testwork, there was no risk assessment questionnaire completed. • For 3 of 4 projects selected for testwork, a risk assessment questionnaire was completed, however there were no required monitoring procedures outlined within the questionnaire. As a result, we were not able to determine what monitoring procedures should have been performed over the projects as a result of the risk assessment. C. The Department’s during the award monitoring includes the review and approval of the subrecipient’s request for reimbursement. During our testwork over the review and approval of the request for reimbursement, we noted that for all 9 invoices selected for testwork, that while the invoice appeared to be properly reviewed and approved, the level of detail included within the invoice would not allow the Department to determine the reasonableness of the costs incurred to ensure that they were incurred in accordance with the grant agreement. D. The Department’s during the award monitoring includes obtaining a progress report related to each project that the subrecipient has been granted funding for. As part of our testwork, we identified that for all 4 projects selected for testwork, while a progress report was obtained, there was no evidence provided to support that the Department had reviewed the report. As a result, we were unable to determine based on the Department’s risk assessment procedures what the type and frequency of monitoring procedures that should have been performed over each project. E. The Department does not have formal policies and procedures to review and maintain documentation to evidence the review and approval of the subrecipient’s unform guidance report. There was no documentation to support that the Department had obtained and reviewed its subrecipient’s most recent uniform guidance report issued. Cause The cause of the condition found was primarily due to a lack of formal written policies and procedures and internal controls to ensure that all required subrecipient monitoring compliance procedures are being performed by the Department. Effect The effect of the condition found is that the Department did not comply with 2 CFR section 200.332(a), 2 CFR section 200.332(b), 2 CFR sections 200.332(d) through (f), and 2 CFR section 200.501(h). Questioned Costs: None. Recommendation We recommend the Department develop written policies and procedures and implement internal controls to ensure that the Department complies with 2 CFR section 200.332(a), 2 CFR section 200.332(b), 2 CFR sections 200.332(d) through (f), and 2 CFR section 200.501(h). This would ensure that all subrecipient grant agreements contains all required communications, that a risk assessment is performed that will outline the types and frequency of monitoring procedures to be performed, that all during the award monitoring activities are properly documented and that the receipt and review of the subrecipient’s uniform guidance report is properly documented. View of Responsible Officials: Management partially concurs with this finding. Rejoinder: As documented within the condition found, sufficient documentation was not provided to demonstrate that the Department complied with 2 CFR section 200.332(a), 2 CFR section 200.332(b), 2 CFR sections 200.332(d) through (f), and 2 CFR section 200.501(h).
Finding Reference Number: 2024-005 NH Fish and Game Department Fish and Wildlife Cluster (Assistance Listing #15.605, #15.611, #15.626) Federal Award Numbers: F22AF00995-00, F22AF00929-00, F23AF03086-00, F22AF00514-01, F22AF02616-02 Federal Award Year: 2022, 2023 U.S. Department of Interior Compliance Requirement: Subrecipient Monitoring Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: N/A Statistically Valid Sample: The sample was not intended to be, and was not, a statistically valid sample. Criteria A pass-through entity (PTE) must: 1. Identify the Award and Applicable Requirements - Clearly identify to the subrecipient required award information and applicable requirements described in 2 CFR section 200.332(a). 2. Evaluate Risk – 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)). 3. Monitor – 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: a. Reviewing financial and programmatic (performance and special reports) required by the PTE. b. 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. c. 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. 2 CFR 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide 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. This would include internal controls related to the cash management process. Condition During the year ended June 30, 2024, the New Hampshire Fish and Game Department (the Department) passed through $484,952 of federal funding to 1 subrecipient to fund 4 different projects. As part of our testwork related subrecipient monitoring, we identified the following: A. The Department communicates award information through the approved grant agreement. For 3 of 4 projects selected for testwork, the Department did not communicate all the required award information as outlined in 2 CFR 200.332(b). Specifically, the following elements were not communicated: • Subrecipient's unique entity identifier • Identification of whether the Federal award is for research and development B. As part of the during the award monitoring testwork, we noted that the Department completes a risk assessment questionnaire for all new projects they approve for the subrecipient. As part of our testwork over the risk assessments performed, we identified the following: • For 1 of 4 projects selected for testwork, there was no risk assessment questionnaire completed. • For 3 of 4 projects selected for testwork, a risk assessment questionnaire was completed, however there were no required monitoring procedures outlined within the questionnaire. As a result, we were not able to determine what monitoring procedures should have been performed over the projects as a result of the risk assessment. C. The Department’s during the award monitoring includes the review and approval of the subrecipient’s request for reimbursement. During our testwork over the review and approval of the request for reimbursement, we noted that for all 9 invoices selected for testwork, that while the invoice appeared to be properly reviewed and approved, the level of detail included within the invoice would not allow the Department to determine the reasonableness of the costs incurred to ensure that they were incurred in accordance with the grant agreement. D. The Department’s during the award monitoring includes obtaining a progress report related to each project that the subrecipient has been granted funding for. As part of our testwork, we identified that for all 4 projects selected for testwork, while a progress report was obtained, there was no evidence provided to support that the Department had reviewed the report. As a result, we were unable to determine based on the Department’s risk assessment procedures what the type and frequency of monitoring procedures that should have been performed over each project. E. The Department does not have formal policies and procedures to review and maintain documentation to evidence the review and approval of the subrecipient’s unform guidance report. There was no documentation to support that the Department had obtained and reviewed its subrecipient’s most recent uniform guidance report issued. Cause The cause of the condition found was primarily due to a lack of formal written policies and procedures and internal controls to ensure that all required subrecipient monitoring compliance procedures are being performed by the Department. Effect The effect of the condition found is that the Department did not comply with 2 CFR section 200.332(a), 2 CFR section 200.332(b), 2 CFR sections 200.332(d) through (f), and 2 CFR section 200.501(h). Questioned Costs: None. Recommendation We recommend the Department develop written policies and procedures and implement internal controls to ensure that the Department complies with 2 CFR section 200.332(a), 2 CFR section 200.332(b), 2 CFR sections 200.332(d) through (f), and 2 CFR section 200.501(h). This would ensure that all subrecipient grant agreements contains all required communications, that a risk assessment is performed that will outline the types and frequency of monitoring procedures to be performed, that all during the award monitoring activities are properly documented and that the receipt and review of the subrecipient’s uniform guidance report is properly documented. View of Responsible Officials: Management partially concurs with this finding. Rejoinder: As documented within the condition found, sufficient documentation was not provided to demonstrate that the Department complied with 2 CFR section 200.332(a), 2 CFR section 200.332(b), 2 CFR sections 200.332(d) through (f), and 2 CFR section 200.501(h).
Finding Reference Number: 2024-17 NH Department of Health and Human Services Aging Cluster and COVID-19 Aging Cluster (Assistance Listing #93.044, #93.045, #93.053) Federal Award Number: 2401NHOASS, 2301NHOASS Federal Award Year: 2023, 2024 U.S. Department of Health and Human Services Compliance Requirement: Subrecipient Monitoring Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: N/A Statistically Valid Sample: The sample was not intended to be, and was not, a statistically valid sample. Criteria A pass-through entity (PTE) must: 1. Evaluate Risk – 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)). 2. Monitor – 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: a. Reviewing financial and programmatic (performance and special reports) required by the PTE. b. 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. c. 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. Additionally, 45 CFR section 75 303(a) states the non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition During the year ended June 30, 2024, the New Hampshire Department of Health and Human Services (the Department) passed through $9,048,291 of federal funding to subrecipients. As part of our testing related subrecipient monitoring, we identified the following: A. For 2 of 7 subrecipients selected for testwork, a risk assessment was not completed. As a result, we were unable to determine if the Department had adequately monitored the subrecipient. There was no documentation provided that any monitoring procedures were performed. B. For 2 of 7 subrecipients selected for testwork, a transportation risk assessment was completed. Per review of the risk assessment, a quarterly review was to be performed to examine the expenditure detail to assess purchasing compliance with contract requirements and applicable laws or rules. There was no documentation provided that this review had taken place. In addition, a nutrition risk assessment was also completed, however there were no specified monitoring procedures. As such, we are unable to determine if the appropriate monitoring procedures were performed for this subrecipient. C. For 1 of 7 subrecipients selected for testwork, a nutrition risk assessment was completed. Based on our review of the risk assessment, a review was to be performed to examine the expenditure detail to assess purchasing compliance with contract requirements and applicable laws or rules. There was no documentation provided to support that this type of monitoring procedure was performed. D. For 1 of 7 subrecipients selected for testwork, the nutrition risk assessment that was completed did not contain any required monitoring procedures. As such, we are unable to determine if the appropriate monitoring procedures were performed for this subrecipient. E. For 1 of 7 subrecipients selected for testwork the nutrition risk assessment indicated that an onsite review should be performed annually. The risk assessment was dated July 19, 2023 and as of June 30, 2024 an on-site monitoring review was not completed. We further noted that a review was conducted in October of 2024. As the risk assessment indicated the review was to be conducted annually, it does not appear that this review was completed timely. Cause The cause of the condition found was primarily due to a lack of formal documented policies, procedures and internal controls to ensure to ensure that required monitoring procedures outlined within the subrecipient’s risk assessment is performed. Effect The effect of the condition found is that the Department did not comply with 2 CFR section 200.332(b), and 2 CFR sections 200.332(d) through (f). Questioned Costs: None. Recommendation We recommend the Department develop written policies and procedures and implement internal controls to ensure that the Department complies with 2 CFR section 200.332(b), and 2 CFR sections 200.332(d) through (f). This would ensure that all required award identification information is properly communicated to subrecipients, and that the prescribed monitoring procedures outlined within the risk assessment are properly performed. Written policies and procedures should be established to ensure that if the risk assessment has suggested a particular monitoring procedure be performed, that the Department is adequately documenting its monitoring procedures to ensure that it has performed the required procedures. View of Responsible Officials: Management concurs with the finding above.
Finding Reference Number: 2024-17 NH Department of Health and Human Services Aging Cluster and COVID-19 Aging Cluster (Assistance Listing #93.044, #93.045, #93.053) Federal Award Number: 2401NHOASS, 2301NHOASS Federal Award Year: 2023, 2024 U.S. Department of Health and Human Services Compliance Requirement: Subrecipient Monitoring Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: N/A Statistically Valid Sample: The sample was not intended to be, and was not, a statistically valid sample. Criteria A pass-through entity (PTE) must: 1. Evaluate Risk – 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)). 2. Monitor – 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: a. Reviewing financial and programmatic (performance and special reports) required by the PTE. b. 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. c. 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. Additionally, 45 CFR section 75 303(a) states the non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition During the year ended June 30, 2024, the New Hampshire Department of Health and Human Services (the Department) passed through $9,048,291 of federal funding to subrecipients. As part of our testing related subrecipient monitoring, we identified the following: A. For 2 of 7 subrecipients selected for testwork, a risk assessment was not completed. As a result, we were unable to determine if the Department had adequately monitored the subrecipient. There was no documentation provided that any monitoring procedures were performed. B. For 2 of 7 subrecipients selected for testwork, a transportation risk assessment was completed. Per review of the risk assessment, a quarterly review was to be performed to examine the expenditure detail to assess purchasing compliance with contract requirements and applicable laws or rules. There was no documentation provided that this review had taken place. In addition, a nutrition risk assessment was also completed, however there were no specified monitoring procedures. As such, we are unable to determine if the appropriate monitoring procedures were performed for this subrecipient. C. For 1 of 7 subrecipients selected for testwork, a nutrition risk assessment was completed. Based on our review of the risk assessment, a review was to be performed to examine the expenditure detail to assess purchasing compliance with contract requirements and applicable laws or rules. There was no documentation provided to support that this type of monitoring procedure was performed. D. For 1 of 7 subrecipients selected for testwork, the nutrition risk assessment that was completed did not contain any required monitoring procedures. As such, we are unable to determine if the appropriate monitoring procedures were performed for this subrecipient. E. For 1 of 7 subrecipients selected for testwork the nutrition risk assessment indicated that an onsite review should be performed annually. The risk assessment was dated July 19, 2023 and as of June 30, 2024 an on-site monitoring review was not completed. We further noted that a review was conducted in October of 2024. As the risk assessment indicated the review was to be conducted annually, it does not appear that this review was completed timely. Cause The cause of the condition found was primarily due to a lack of formal documented policies, procedures and internal controls to ensure to ensure that required monitoring procedures outlined within the subrecipient’s risk assessment is performed. Effect The effect of the condition found is that the Department did not comply with 2 CFR section 200.332(b), and 2 CFR sections 200.332(d) through (f). Questioned Costs: None. Recommendation We recommend the Department develop written policies and procedures and implement internal controls to ensure that the Department complies with 2 CFR section 200.332(b), and 2 CFR sections 200.332(d) through (f). This would ensure that all required award identification information is properly communicated to subrecipients, and that the prescribed monitoring procedures outlined within the risk assessment are properly performed. Written policies and procedures should be established to ensure that if the risk assessment has suggested a particular monitoring procedure be performed, that the Department is adequately documenting its monitoring procedures to ensure that it has performed the required procedures. View of Responsible Officials: Management concurs with the finding above.
Finding Reference Number: 2024-17 NH Department of Health and Human Services Aging Cluster and COVID-19 Aging Cluster (Assistance Listing #93.044, #93.045, #93.053) Federal Award Number: 2401NHOASS, 2301NHOASS Federal Award Year: 2023, 2024 U.S. Department of Health and Human Services Compliance Requirement: Subrecipient Monitoring Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: N/A Statistically Valid Sample: The sample was not intended to be, and was not, a statistically valid sample. Criteria A pass-through entity (PTE) must: 1. Evaluate Risk – 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)). 2. Monitor – 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: a. Reviewing financial and programmatic (performance and special reports) required by the PTE. b. 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. c. 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. Additionally, 45 CFR section 75 303(a) states the non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition During the year ended June 30, 2024, the New Hampshire Department of Health and Human Services (the Department) passed through $9,048,291 of federal funding to subrecipients. As part of our testing related subrecipient monitoring, we identified the following: A. For 2 of 7 subrecipients selected for testwork, a risk assessment was not completed. As a result, we were unable to determine if the Department had adequately monitored the subrecipient. There was no documentation provided that any monitoring procedures were performed. B. For 2 of 7 subrecipients selected for testwork, a transportation risk assessment was completed. Per review of the risk assessment, a quarterly review was to be performed to examine the expenditure detail to assess purchasing compliance with contract requirements and applicable laws or rules. There was no documentation provided that this review had taken place. In addition, a nutrition risk assessment was also completed, however there were no specified monitoring procedures. As such, we are unable to determine if the appropriate monitoring procedures were performed for this subrecipient. C. For 1 of 7 subrecipients selected for testwork, a nutrition risk assessment was completed. Based on our review of the risk assessment, a review was to be performed to examine the expenditure detail to assess purchasing compliance with contract requirements and applicable laws or rules. There was no documentation provided to support that this type of monitoring procedure was performed. D. For 1 of 7 subrecipients selected for testwork, the nutrition risk assessment that was completed did not contain any required monitoring procedures. As such, we are unable to determine if the appropriate monitoring procedures were performed for this subrecipient. E. For 1 of 7 subrecipients selected for testwork the nutrition risk assessment indicated that an onsite review should be performed annually. The risk assessment was dated July 19, 2023 and as of June 30, 2024 an on-site monitoring review was not completed. We further noted that a review was conducted in October of 2024. As the risk assessment indicated the review was to be conducted annually, it does not appear that this review was completed timely. Cause The cause of the condition found was primarily due to a lack of formal documented policies, procedures and internal controls to ensure to ensure that required monitoring procedures outlined within the subrecipient’s risk assessment is performed. Effect The effect of the condition found is that the Department did not comply with 2 CFR section 200.332(b), and 2 CFR sections 200.332(d) through (f). Questioned Costs: None. Recommendation We recommend the Department develop written policies and procedures and implement internal controls to ensure that the Department complies with 2 CFR section 200.332(b), and 2 CFR sections 200.332(d) through (f). This would ensure that all required award identification information is properly communicated to subrecipients, and that the prescribed monitoring procedures outlined within the risk assessment are properly performed. Written policies and procedures should be established to ensure that if the risk assessment has suggested a particular monitoring procedure be performed, that the Department is adequately documenting its monitoring procedures to ensure that it has performed the required procedures. View of Responsible Officials: Management concurs with the finding above.
Finding Reference Number: 2024-17 NH Department of Health and Human Services Aging Cluster and COVID-19 Aging Cluster (Assistance Listing #93.044, #93.045, #93.053) Federal Award Number: 2401NHOASS, 2301NHOASS Federal Award Year: 2023, 2024 U.S. Department of Health and Human Services Compliance Requirement: Subrecipient Monitoring Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: N/A Statistically Valid Sample: The sample was not intended to be, and was not, a statistically valid sample. Criteria A pass-through entity (PTE) must: 1. Evaluate Risk – 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)). 2. Monitor – 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: a. Reviewing financial and programmatic (performance and special reports) required by the PTE. b. 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. c. 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. Additionally, 45 CFR section 75 303(a) states the non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition During the year ended June 30, 2024, the New Hampshire Department of Health and Human Services (the Department) passed through $9,048,291 of federal funding to subrecipients. As part of our testing related subrecipient monitoring, we identified the following: A. For 2 of 7 subrecipients selected for testwork, a risk assessment was not completed. As a result, we were unable to determine if the Department had adequately monitored the subrecipient. There was no documentation provided that any monitoring procedures were performed. B. For 2 of 7 subrecipients selected for testwork, a transportation risk assessment was completed. Per review of the risk assessment, a quarterly review was to be performed to examine the expenditure detail to assess purchasing compliance with contract requirements and applicable laws or rules. There was no documentation provided that this review had taken place. In addition, a nutrition risk assessment was also completed, however there were no specified monitoring procedures. As such, we are unable to determine if the appropriate monitoring procedures were performed for this subrecipient. C. For 1 of 7 subrecipients selected for testwork, a nutrition risk assessment was completed. Based on our review of the risk assessment, a review was to be performed to examine the expenditure detail to assess purchasing compliance with contract requirements and applicable laws or rules. There was no documentation provided to support that this type of monitoring procedure was performed. D. For 1 of 7 subrecipients selected for testwork, the nutrition risk assessment that was completed did not contain any required monitoring procedures. As such, we are unable to determine if the appropriate monitoring procedures were performed for this subrecipient. E. For 1 of 7 subrecipients selected for testwork the nutrition risk assessment indicated that an onsite review should be performed annually. The risk assessment was dated July 19, 2023 and as of June 30, 2024 an on-site monitoring review was not completed. We further noted that a review was conducted in October of 2024. As the risk assessment indicated the review was to be conducted annually, it does not appear that this review was completed timely. Cause The cause of the condition found was primarily due to a lack of formal documented policies, procedures and internal controls to ensure to ensure that required monitoring procedures outlined within the subrecipient’s risk assessment is performed. Effect The effect of the condition found is that the Department did not comply with 2 CFR section 200.332(b), and 2 CFR sections 200.332(d) through (f). Questioned Costs: None. Recommendation We recommend the Department develop written policies and procedures and implement internal controls to ensure that the Department complies with 2 CFR section 200.332(b), and 2 CFR sections 200.332(d) through (f). This would ensure that all required award identification information is properly communicated to subrecipients, and that the prescribed monitoring procedures outlined within the risk assessment are properly performed. Written policies and procedures should be established to ensure that if the risk assessment has suggested a particular monitoring procedure be performed, that the Department is adequately documenting its monitoring procedures to ensure that it has performed the required procedures. View of Responsible Officials: Management concurs with the finding above.