Finding 1145271 (2024-001)

BETH ISRAEL LAHEY HEALTH, INC. AND AFFILIATES Schedule of Findings and Questioned Costs Year ended September 30, 2024 (3) Findings and Questioned Costs Relating to Federal Awards Finding 2024-001 – Subrecipient Monitoring Federal Agency: United States Department of Health and Human Services Program: Research and Development Cluster Assistance Listing Number: 93.837 and 93.847 Criteria: Criteria: 2 CFR 200.332(b) requires pass-through entities to evaluate each subrecipient’s risk of non-compliance 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 200.332. Further, 200.332(d) requires pass-through entities to 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. Condition: Annually, BILH works with over 200 subrecipients in conducting its research activities. While Joslin Diabetes Center (the Center) has a subrecipient pre-award risk assessment process in place, for 5 of 9 subrecipients selected for testwork, we were unable to verify that the pre-award risk assessment procedures were fully performed. Additionally, while the Center’s risk assessment procedures correspond with a risk-based monitoring plan, for 8 of 9 subrecipients selected for testwork, we were unable to verify that the required monitoring activities were fully completed. We deemed this to be a significant deficiency in internal controls. Cause: As a result of turnover during the fiscal year within Research Finance there was a lack of effective operation of internal controls over subrecipient risk assessment and monitoring activities. Possible Asserted Effect: Without the proper operation of an effectively designed system of internal controls, the internal control system cannot be relied upon to effectively prevent or detect non-compliance. Questioned Costs: None. Statistical Sampling: The sample was not intended to be, and was not, a statistically valid sample. Identification of Whether the Audit Finding was a Repeat Finding: This is a repeat finding. (Prior year finding 2023-002) BETH ISRAEL LAHEY HEALTH, INC. AND AFFILIATES Schedule of Findings and Questioned Costs Year ended September 30, 2024 Recommendation: We recommend that the Center evaluate its current Subrecipient Monitoring and Management Policy to ensure that the policy reflects each of the risk assessment and monitoring compliance requirements of the Uniform Guidance. Additionally, the results of the Center’s risk assessment and monitoring activities should be formally documented within the tracking log which should then be subject to formal review and approval by an appropriate individual within Research Finance. Views of Responsible Officials: Management acknowledges although tracking logs had been maintained, due to personnel turnover during the year, not all had been reviewed. Management has since created a shared email address to ensure communication and information sharing with all necessary parties. Management is reviewing its current policy for opportunities to strengthen internal controls and current procedures while utilizing available resources.