Finding 1218858 (2025-002)

2025-002 – Subrecipient Monitoring - Lack of evidence of subrecipient Uniform Guidance report reviews Cluster: Research and Development Sponsoring Agency: Various agencies Award Names: Southeast Region Cybersecurity Collaboration Center (SERC3), Establish, manage, and maintain a public-private partnership (PPP) additive manufacturing (AM) consortium for the Rapid Manufacturing Propulsion Technology (RAMPT), Developing effective adaptation strategies to enhance the resilience of farmers under changing climate, Towards a sustainable bioeconomy: Biotransformation of paper mill sludge for value-added chirally pure (R)-1,3-butanediol production, A systems approach to perennial forage management using plant growth-promoting rhizobacteria Award Numbers: 212514, 208409, 200987, 205258, and 205264 Assistance Listing Title: Cybersecurity, Energy Security & Emergency Response (CESER), Science, Integrative Activities, and Agriculture and Food Research Initiative (AFRI) Assistance Listing Number: 81.008, 43.RD, 47.083, and 10.310 Award Year: 2024 - 2025 Pass-through entity: UT-Batelle LLC, RPM Innovations, Inc., New Mexico State University, Regents of the University of California, and University of Tennessee Criteria 2 CFR 200.332(f) notes that a pass-through entity must verify that every subrecipient is audited as required by the Uniform Guidance when it is expected that the subrecipient's Federal awards expended during the respective fiscal year equaled or exceeded the threshold set forth in 2 CFR 200.501. Condition Through our testing of 24 subrecipients, we noted the following: • For the Research and Development Cluster, 5 out of 24 samples tested did not have supporting documentation to verify Auburn’s review of subrecipient’s financial statements and/or Uniform Guidance report available. Cause The University indicated subrecipient reviews were not consistently performed in accordance with 2 CFR 200.501. Additionally, due to a lack of clearly defined roles, responsibilities, and documentation practices among the existing team members within the Office of Sponsored Programs, the Uniform Guidance requirements (and related University procedures) around subrecipient reviews were not consistently performed and/or documented. Effect The inconsistency of reviews performed over subrecipient financial statements and Uniform Guidance reports may result in ineligible subrecipients receiving federal awards, subrecipient findings not being fully remediated, and other applicable procedures not being performed timely and appropriately. Questioned Costs None noted. Repeat Finding Yes. Repeat of finding 2024-002. Recommendation We recommend that the University reassess the design of its controls around the review process of subrecipient financial statements and Uniform Guidance reports. The University should ensure its procedures properly address the review process of this information, including timeliness and appropriate personnel. The University should also ensure these annual reviews are being appropriately documented and the documentation is being maintained properly. Management’s Views and Corrective Action Plan Management’s Views and Corrective Action Plan are included at the end of this report after the summary schedule of prior audit findings and status