Finding Text
Criteria: When Federal awards allow for advance payments, recipients must follow procedures to minimize the time lapsing between the transfer of funds from the Federal government and disbursement. Condition: The Organization requests funds from their partner agencies in advance with no written procedures in place to minimize the time between receipt of the Federal funds and the related disbursement of those funds. Cause: Historically, upon execution of annual partnership intermediary agreements, the Organization is instructed by the funding agency to request the full amount of the award at that time. These awards span anywhere from six months to a year in length. Effect: The Organization was not in compliance with the Uniform Guidance cash management requirements. Questioned Costs: None Context: The Organization has not established written policies and procedures to minimize the time elapsing between the transfer of funds from the Federal government and the related disbursement of those funds. Recommendation: The Organization should establish written policies and procedures for contracts which require cash advances and determine an appropriate length of time, or interval of funding, necessary for the Organization to operate at the appropriate level. Additionally, when possible, the Organization should operate its contracts on a cost reimbursement basis, with minimal cash advances. Views of Responsible Officials: See management’s view and corrective action plan at the end of this report.