Finding: Subrecipient Single Audits. The Organization’s grant and subgrant agreements explicitly require subgrantees to undergo a single audit if they expend $750,000 or more in a fiscal year, as stipulated by the Department of State. However, audits were not performed for subgrantees exceeding this threshold in Cameroon, South Sudan, and Iraq. This non-compliance was caused by failures in the subrecipient control monitoring process. Corrective Action Plan JRS/USA recognizes the risk presented when Country Offices (COs) or Regional Offices (ROs) are unable to meet audit requirements, particularly when receiving U.S. federal funds. While JRS/USA does not have direct authority to mandate CO/RO audits in all regions, we recognize our responsibility to ensure federal compliance across the global network. To address this, JRS/USA will implement a stricter due diligence and pre-award assessment process. Specifically, going forward, COs/ROs must demonstrate the ability to meet audit and financial reporting requirements as a condition for receiving federal funding. If these requirements are not met, JRS USA will take corrective action, which may include suspending their inclusion in federal awards until compliance can be assured. JRS/USA will also revisit the previously proposed “go/no-go” framework and explore its formal adoption as part of a broader compliance risk management strategy. To address this gap and strengthen subrecipient oversight related to audit compliance, JRS/USA is implementing the following measures: 1. Reinforced Audit Clause Communication JRS/USA has reviewed and re-communicated the audit requirements to all subrecipients (country offices), particularly those with high federal expenditures. Subgrantees are being reminded annually in writing of their obligation to procure a Single Audit or Program-Specific Audit if they meet the $750,000 threshold. 2. Enhanced Subrecipient Monitoring Process The subrecipient monitoring framework has been updated to include: a) Annual tracking of total federal expenditures by each subrecipient (country office) b) Flagging of subrecipients approaching the $750,000 threshold c) A review checkpoint at year-end to determine audit applicability d) Clear documentation requirements and timelines for submitting audit report 3. Audit Compliance Checklist and Tracker A standardized checklist has been created to track audit requirements and receipt of audit documentation from all subrecipients (country offices). This checklist is maintained centrally by the JRS/USA compliance or grants team and reviewed quarterly. 4. Technical Support to Subrecipients Subrecipients (country offices) that may lack familiarity with the Single Audit requirement are being offered guidance and support on: a) Identifying qualified auditors b) Understanding scope and timing of required audits c) Budgeting for audit costs appropriately 5. Subaward Risk Assessments Updated The risk assessment conducted during subaward issuance and annual monitoring now includes specific indicators for federal expenditure levels and audit compliance risk. This ensures earlier detection and mitigation for high-risk subrecipients. Timeline for Implementation All corrective actions have been implemented or will be fully in effect by January 30, 2026. Responsible Party Samira Ahmed, Senior Grants and Compliance Specialist, will be responsible for ensuring subrecipient audit compliance and ongoing monitoring.