Finding Text
Federal Agency: U.S. Department of Health and Human Services CFDA Program: 93.323 Epidemiology and Laboratory Capacity for Infectious Diseases Award Number: 1NU50CK0004990100 and 6NU50CK0004990104 Area: Equipment and Real Property Management Questioned Costs: Undeterminable Criteria: In accordance with 2 CFR 200.313(b), a state must use, manage, and dispose of equipment acquired under a federal award in accordance with state laws and regulations. The CHCC Operating Policy: Fixed Asset/Property Changes requires the CHCC Property Management Branch to perform an annual physical inventory of all fixed assets/property and to document and control all changes in fixed assets/property. Further, in accordance with 2 CFR 200.313(d)(1), property records must include a description of the property, a serial number or another identification number, the source of funding for the property (including the FAIN), the title holder, the acquisition date, the cost of the property, the percentage of the Federal agency contribution towards the original purchase, the location, use and condition of the property, and any disposition data including the date of disposal and sale price of the property. The recipient and subrecipient are responsible for maintaining and updating property records when there is a change in the status of the property. Lastly, 2 CFR 200.313(d)(3) requires that adequate maintenance procedures must be developed to keep the property in good condition. Condition: For eight (or 100%) of eight capital assets selected for testing, the following were noted: 1. CHCC did not provide any supporting documentation that a physical inventory count was performed in FY2020. No questioned costs are presented as we are not able to quantify the extent of noncompliance. 2. CHCC’s capital assets listing does include all the required information for equipment and real property that is in accordance with 2 CFR 200.313(d)(1). No questioned costs are presented as we are not able to quantify the extent of noncompliance. 3. Capital asset items could not be traced to the results of the periodic maintenance procedures performed. No questioned costs are presented as we are not able to quantify the extent of noncompliance Cause: 1. CHCC’s current policy and procedure for capital asset listing management and maintenance are not in accordance with the federal requirements stated in 2 CFR 200.313(d)(1). 2. CHCC’s document maintenance and retention controls did not operate as designed to ensure that the recorded results of the physical inventory and maintenance procedures are stored properly and that documents are easily retrieved. 3. The results of CHCC’s periodic maintenance procedures lack unique identifiers necessary to trace the selected samples between the capital assets listing and the maintenance results. Effect: CHCC is in noncompliance with applicable Equipment and Real Property Management requirements. Questioned costs are undetermined as we are unable to quantify the extent of noncompliance. Recommendation: 1. CHCC should update the structure and contents of their current capital asset listing to include all the information required by 2 CFR 200.313(d)(1). Additionally, CHCC should improve their policies and procedures on management and maintenance of their capital asset listing. 2. CHCC should implement more stringent policies and procedures in relation to their document maintenance and retention to ensure that documents are easily retrieved and provided in a timely manner. Views of Responsible Officials: CHCC concurs with the findings. CHCC will update its Capital Assets policy to comply with the requirements of 2 CFR 200.313. Furthermore, CHCC will ensure that there is a clear crosswalk between the Preventive Maintenance Record with our Facilities Department and the Capital Assets listing that is revised pursuant to the requirements of 2 CFR 200.313. CHCC would like to clarify that although the documentation fell short of the Uniform Guidance documentation, all the physical existence and working conditions were verifiable during the audit.