Finding Text
2025-001 - Material Weakness in Internal Control and Material Compliance over Subrecipient Monitoring: Incomplete Subaward Agreements Identification of federal programs: Federal Agency: Department of Commerce (DOI) ALN: 11.438 – Pacific Coast Salmon Recovery Pacific Salmon Treaty Program Award Numbers: NA22NMF4380226, NA20NMF4380258, and NA21NMF4380467 Criteria: Per 2 CFR 200.332(a), pass-through entities must provide specific information to subrecipients at the time of the subaward, including but not limited to: Subrecipient name, UEI, and contact information Federal Award Identification Number (FAIN) Federal award date Period of performance CFDA/ALN number and program name Total amount of federal funds obligated All requirements imposed by the pass-through entity Indirect cost rate information Provisions for closeout Failure to include the required information limits the subrecipient’s ability to comply with federal requirements. Condition: During our testing of subrecipient monitoring, we noted that the subawards were missing elements under 2 CFR 200.332(a), including the assistance listing number and amount of federal funds obligated. Further, these relevant compliance requirements were not communicated to the subrecipients at any other time in writing. The entity made subaward payments totaling $784,907 during the audit period without maintaining complete documentation demonstrating compliance with federal subaward requirements. Cause: Pass through funding through subawards was new for the Organization and they were not familiar with subrecipient disclosure requirements. Effect or potential effect: Failure to issue complete subaward agreements increases the likelihood that subrecipients may not comply with federal requirements. These deficiencies represent a material weakness because they indicate a reasonable possibility that material noncompliance with federal requirements could occur and not be prevented or detected. Questioned Costs: None. Context: There were seven subrecipients under the program. In 2025, subrecipient expenditures totaled $784,907. Identification of Repeat Finding: Not applicable. Recommendations: Management should implement a standardized subaward agreement template that incorporates all elements required by 2 CFR 200.332(a). Views of Responsible Officials: See Corrective Action Plan.