Finding Text
Finding 2024-005: Period of Performance Program Title: Defense Nuclear Nonproliferation Research Assistance Listing Number: 81.113 Federal Agency: U.S. Department of Energy Direct Award Identifying Numbers: DE-NA003862, DE-NA004179, DE-NA0004177 Federal Award Year: Year ended September 30, 2024 Program Title: Export Control and Related Border Security Assistance Listing Number: 19.901 Federal Agency: U.S. Department of State Direct Award Identifying Number: SAQMIP23CA0153 Pass-Through Entity Name, Pass-Through Identifying Number: The Research Foundation for SUNY, University at Albany, 3-98939 Federal Award Year: Year ended September 30, 2024 Type of Finding: Material Weakness in Internal Control over Compliance Criteria: According to 2 CFR §200.303, the non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non- Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in Standards for Internal Control in the Federal Government issued by the Comptroller General of the United States or the Internal Control Integrated Framework, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: During our testing over expenditures, we noted that there is no written documentation of the review and approval of transactions that are reimbursed by Federally funded awards. Cause: PFI does not have a formal policy in place with respect to documenting management’s review and approval over expenditures of Federal awards. As such, PFI did not have effective internal controls in place to ensure that approvals were performed and documented as being performed in a timely manner. Effect or Potential Effect: There is the potential that expenditures allocated to the Federal awards were not properly reviewed in a timely manner and could have been charged to a Federally funded award outside of the grant’s stated period of performance, thereby creating a potential for being reimbursed for unallowable costs. Questioned Costs: None. Context: 3 out of 3 grants under ALN 81.113 and 2 out of 2 grants under ALN 19.901 selected for control testing did not have documented review and approval for their expenditures. The sample is deemed representative of the population. Repeat Finding: Not applicable. Recommendation: We recommend that PFI implement a formal expense review and approval policy. This policy should require that management formally review and approve all expense transactions on a timely basis.