Finding Text
Federal Agency: United States Department of Commerce
Federal Program Name: Office for Coastal Management
Assistance Listing Number: 11.473
Federal Award Identification Year: 2020
Pass-Through Agency: National Fish and Wildlife Grant Agreement
Award Period: 9/1/20-08/31/23
Type of Finding: Other Matters – Material Weakness in Internal Control
Criteria: 2 CFR 200.414(c) - Federal award recipients must negotiate an indirect cost rate with the cognizant agency for indirect costs, which is typically the federal agency that provides the most funding to the recipient.2 CFR 200.403(d) - The negotiated rate must be applied consistently across all federal awards to ensure uniformity in cost allocation. 2 CFR 200.302(b)(3) - Recipients must maintain adequate documentation to support the indirect costs charged to federal awards, ensuring compliance with the cost principles outlined in the regulation.
Condition: For two reimbursement requests from the grantor, an indirect cost rate was used, for which CSFC did
not have a provisional or final rate agreement from the USDA.
Context: Of the 2 reimbursements invoiced, 2 were selected for testing for the Office for Coastal Management
program. The condition noted above was identified during our procedures over CFSC’s subrecipients.
Effect: CFSC did not identify the error to be able to make the appropriate corrections before receiving reimbursement for incorrect indirect cost rate invoiced.
Cause: CFSC’s procedures did not ensure that the negotiated provisional rate was invoiced properly.
Repeat Finding: The finding is not a repeat finding.
Recommendation: We recommend that CFSC modify and strengthen its current policies and procedures to perform review over the indirect cost rate utilized when submitting invoices to the grantor.
Management’s Views: See separate corrective action plan.