Finding Text
Program: ALL No. 10.523 Centers of Excellence at 1890 Institutions Significant Deficiency and Noncompliance over Subrecipient Monitoring Repeat Finding: Yes Condition: Management did not verify that its subrecipients were not suspended or debarred or otherwise excluded from participating in the transactions. Criteria: In accordance with 2 CFR §200.303, the non-federal entity must establish and maintain effective internal controls 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. Pursuant to 31 USC 7502(f)(2) (Single Audit Act Amendments of 1996 (Pub. L. No. 104-156)), 2 CFR sections 200.330, .331, and .501(h), a pass-through entity must identify the award and applicable requirements, evaluate risk, monitor, and ensure accountability of subrecipients. Additionally, when entering into subaward transactions, the non-federal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, not suspended or debarred or otherwise excluded from participating in the transaction. This verification may be accomplished by (1) checking the System for Award Management (SAM) Exclusions maintained by the General Services Administration (GSA), (2) collecting a certification from the entity, or (3) adding a clause or condition to the covered transaction with that entity (2CFR 180.300). Cause: Program personnel were unaware of the requirement included in Uniform Guidance related to procedures required for subrecipient monitoring. Effect: If subrecipients were not in compliance with Uniform Guidance, the Foundation would not identify the noncompliance timely. Questioned Costs: Unknown. Recommendation: We recommend that the Foundation implements subrecipient monitoring controls by documenting and implementing procedures in accordance with Uniform Guidance requirements, including providing training to program personnel and developing written policies and checklists to ensure consistent compliance. Auditee Response and Corrective Action Plan: Refer to management’s corrective action plans. Auditor’s Conclusion: Finding remains as stated.