Finding Text
Federal Program: AL 11.307 – Economic Adjustment Assistance
Criteria: Uniform Guidance requires, for any funds passed through to a subrecipient, that the
pass-through entity (The Chamber Foundation) must perform certain activities to ensure that the
subrecipient uses funds within provisions of the grant award and Uniform Guidance (2 CFR
sections 200.331 (d) through (f)). This includes review of independent audits of subrecipients
and response to deficiencies detected through audits (2 CFR section 200.331(f)). It also
includes requiring all subawards granted to subrecipients have specific identifications with the
award to ensure the subaward is clearly identifiable (2 CFR Section 200.331(a)).
Condition: For the year ended August 31, 2024, we reviewed the Foundation’s subrecipient
internal controls, requesting supporting documentation for monitoring activities included, and
interviewed key members of management when documentation was not available. Performance
of several of the policies noted as required under Unform Guidance for subrecipient monitoring
and per the Foundation’s internal controls could not be substantiated or were determined to not
have occurred during the year under audit.
Cause: Due to internal control deficiency noted in 2024-002, the subrecipient monitoring
requirement was not in compliance during the year.
Context: Of the federal expenditures under the program noted, $341,811 are passed through to
subrecipients. The following are specific items noted that were not in compliance with the
criteria listed above:
- We requested copies of the correspondence with subrecipients requesting copies of the
financial statement audits performed in compliance with 2 CFR 200. Follow up
discussion with the Chamber Foundation staff confirmed that this requirement was not
completed during the year under audit. Subsequently, of the four subrecipient audit
reports required to be requested, zero were requested.
- We requested copies of all subawards awarded to subrecipients. Of the four subawards
awarded to pass-through entities, one was missing the following required information
under (2 CFR Section 200.331(a)):
o Subrecipient’s unique entity identifier.
Effect: Increased risk of potential noncompliance with subrecipient monitoring requirements
under Uniform Guidance.
Questioned costs: None
Indication of Repeat Finding: This is not a repeat finding.
Recommendation: The Foundation should request yearly audit reports as determined by 2 CFR
2002. Additionally, the entity should include all required information as determined in CFR
Section 200.331(a) in all subawards.
Views of Responsible Officials: Management recognizes the deficiency and plans to implement
the auditor’s recommendations.