Finding 1103438 (2024-001)

Assistance Listing Number, Federal Agency, and Program Name 10.500 U.S. Deptartment of Agriculture Cooperative Extension Services Research and Developement Cluster: 12.000, U.S. Department of Defense, U.S. Department of Defense 12.431, U.S. Department of Defense, Basic Scientific Research 47.041, National Science Foundation, Engineering Grants 47.070, National Science Foundation, Computer and Information Science and Engineering 81.049, U.S. Department of Energy, Office of Science Financial Assistance Program 93.855, U.S. Department of Health & Human Services, Allergy, Immunology and Transplantation Research 93.859, U.S. Department of Health & Human Services, Biomedical Research and Research Training 98.001, Agency for International Development, USAID Foreign Assistance for Programs Overseas Federal Award Identification Number and Year 10.500 2021 48762 35660, 2022 48703 38592, 2021 41590 34813 12.000 2021 21090200002 12.431 W52P1J 22 9 3009, W52P1J 20 9 3009 10 47.041 2129782 CMMI, 1647722 EEC, 2132142 EFMA 47.070 2333009 CCF 81.049 DE SC0019215 93.855 5R01AI146160 05 93.859 5R01GM143370 02 98.001 AID 7200AA18CA00009 Pass through Entity N/A Finding Type Significant deficiency Repeat Finding Yes 2023 001 Criteria As outlined in 2 CFR 200.305(b)(3), when the reimbursement method is used for payment, organizations must make a payment within 30 calendar days after receipt of the billing unless the federal awarding agency or pass through entity reasonably believes the request to be improper. Condition The University did not have adequate controls in place to ensure invoices to subrecipients were paid timely within the 30 calendar day requirement. Questioned Costs There were no questioned costs identified. Identification of How Questioned Costs Were Computed There were no questioned costs identified. Context Out of 60 payments to subrecipients that were tested related to the major programs tested, 21 were made after the 30 calendar day requirement. In all samples tested, payment was made to the subrecipient; however, the delayed payments ranged from 31 119 days between the invoice being received by the University and payment being made to the subrecipient. The University did implement new preventative controls in place effective December 31, 2023 in response to prior year finding (2023 001). Of the 21 payments made after the 30 calendar day requirement, 14 occured prior to December 31, 2023, and the remaining 7 occured after. Cause and Effect While the University had effective controls that were successful in achieving the 30 calendar day requirement for 39 samples, the University failed to provide supplemental support and preventive controls during a period when it was addressing an issue that prevented timely payment for certain subrecipients. Recommendation The University should ensure appropriate training of employees is taking place and a preventive control is implemented to ensure that payments are made within the required timeline. Views of Responsible Officials and Corrective Action Plan Purdue University will address the recommendations and implement the following preventative controls to ensure that payments are made within the required timeline. 1) The Office of Research will increase the priority around the 30-day processing deadline mandated by the Uniform Guidance 2 CFR 200.305 (b)(3). This will be accomplished through communications, training and expectation setting with the following audiences: a) Principal Investigators of active grants with sub-awards i) Blanket communication ii) Add the expected turnaround time on each sub-recipient communication when seeking principal investigator review and approval iii) Modify the workflow email to heighten the awareness and timeliness expectations of processing b) Sub-award Team in Sponsored Program Services i) Blanket communications to SPS, Research Account Specialists, Business Offices, Tax, Accounts Payable/Business Operations ii) Utilize a report developed for internal reporting and tracking of pending sub-invoices to improve follow-up on payments approaching the 30-day deadline iii) Increase the frequency of follow-up on outstanding invoices iv) Add the expected turnaround time to the expectations document for each Sub-Award Team Member v) Add sub-recipient payment deadlines to the mandatory training for the Sub-Award Team vi) Update payment terms to “Payable immediately Due net; Based on Doc Date” for all subrecipient invoices vii) Modify procedures for foreign sub payments to streamline the processing between tax and export control offices related to required screenings 2) Conduct semi-annual training/refresher with sub-award staff. The first training will be held January 2025. 3) Work with subaward team staff to ensure that adequate documentation is created and maintained related to the follow-up that occurs when issues are being investigated and resolved that causes a delay in processing. These include visual compliance screenings for foreign wire transfers and other situations where delays occur for justified reasons (performance issues, delay in progress reports, questionable charges, missing or incomplete information, line-item concerns, etc.). Maintain documentation in the grant or posting document file 4) Evaluate and continually monitor staffing levels on the sub-award team and seek supplemental staffing when warranted.