Finding Text
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.