Finding Text
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.