Finding Text
Federal Agency: Department of Agriculture Assistance Listing Number: 10.310 Program Expenditures: $1,328,494 Program Name: Oilseed Pennycress: A New Cash Cover-Crop for the Midwest Award Number(s): 2019-69012-29851 Questioned Costs: None CONDITION: Western Illinois University (University) did not have adequate procedures in place to complete a timely disbursement of requested pass-through funds to subrecipients within the required time period. During our testing of payments made on requests from subrecipients, there were 2 out of 8 (25%) tested instances of the University not disbursing funds within 30 days of the payment request, as required. For the samples mentioned, the funds were sent 32 days and 120 days after the request. The sample was not a statistically valid sample. CRITERIA: Uniform Guidance (2 CFR 200.305(b)(3)) states that when the reimbursement method is used, the Federal agency or pass-through entity must make payment within 30 calendar days after receipt of the payment request unless the Federal agency or pass-through entity reasonably believes the request to be improper. Uniform Guidance (2 CFR 200.303(a)) requires non-Federal entities receiving Federal awards to establish and maintain internal controls designed to reasonably ensure compliance with Federal laws, regulations, and program compliance requirements. Effective internal controls should include procedures to ensure the timely disbursement of funds to subrecipients. CAUSE AND EFFECT: The University did not have adequate procedures in place to ensure all payments to subrecipients were made within the 30 day requirement. Without sufficient controls around return over subrecipient payments and overall cash management, there is a greater risk that the school will miss a payment to be passed through to the subrecipient, thus understating expenditures on the Schedule of Expenditures of Federal Awards. (Finding Code No. 2025-003) RECOMMENDATION: We recommend the University implement controls to ensure that all payments to be passed through to subrecipients are identified and paid within the required time frame. UNIVERSITY RESPONSE: The University agrees with the finding. The University is committed to developing a comprehensive plan to ensure compliance with payment of pass-through funds policies and procedures.