Finding 1222677 (2025-001)

Assistance Listing, Federal Agency, and Program Name 81.086, 81.087, 81.089, and 81.255, U.S. Department of Energy, Research and Development Cluster. Federal Award Identification Number and Year 81.086 DE EE0010847 81.087 DE EE0009625 and DE EE0011103 81.089 DE FE0028979, DE FE0032172, DE FE0032176, DE FE0032239, DE FE0032287, and DE FE0032351 81.255 DE CD0000038 Pass through Entity 81.086 N/A Direct Award 81.087 N/A Direct Award 81.089 N/A Direct Award 81.255 HyVelocity LLC Finding Type Material weakness and material noncompliance with laws and regulations Repeat Finding No Criteria In accordance with 2 CFR 200.305(b), for recipients and subrecipients other than States, payment methods must minimize the time elapsing between the transfer of funds from the Federal agency or the pass through entity and the disbursement of funds by the recipient or subrecipient regardless of whether the payment is made by electronic funds transfer or by other means. In accordance with 2 CFR 200.305(b)(3), when the reimbursement method is used, the federal awarding agency or pass through entity must make payment within 30 calendar days after receipt of billing, unless it is believed the request to be improper. Condition Controls in place were not sufficient to ensure subrecipients were paid consistently within 30 days of a request for reimbursement. Questioned Costs N/A If questioned costs are not determinable, description of why known questioned costs were undetermined or otherwise could not be reported N/A Identification of How Questioned Costs Were Computed N/A Context Due to staff turnover during the year, controls and procedures designed to ensure subrecipients were reimbursed within 30 days were not consistently operating throughout the period. Out of a sample of 40 subrecipient disbursements tested, we noted 17 were not paid within 30 days of the organization receiving the request for reimbursement and 11 were not properly tracked on management's internal subrecipient payment tracking spreadsheet. Cause and Effect Controls were established to ensure subrecipient reimbursement requests were processed within 30 days; however, due to staff turnover during the year, these controls were not consistently performed. As a result, reimbursement requests were not always processed timely, leading to instances of noncompliance with the 30 day requirement. Recommendation We recommend management reinforce and consistently execute existing controls over the review and processing of subrecipient reimbursement requests, including clear assignment of responsibilities and oversight procedures during periods of staff transition, to ensure payments are made within the 30 day requirement. Views of Responsible Officials and Corrective Action Plan Management acknowledges the finding. Delays in approvals may occur due to multiple internal and external parties involved. to prevent recurrence, management will monitor all parties, issue email reminders with clear deadlines, and enforce compliance with the 30 day requirement.