Finding Text
Reporting – Special Reports for FFATA and Subrecipient Monitoring Assistance Listing Number 14.251 – Economic Development Initiative, Community Project Funding, and Miscellaneous Grants U.S. Department of Housing and Urban Development (HUD) Federal Award Identification Number(s): B-22-CP-CO-0165 Award Year – 2022 Criteria or specific requirement(s): In accordance with the Federal Funding Accountability and Transparency Act (FFATA) and 2 CFR Part 170, recipients are required to report applicable first-tier subawards of $30,000 or more, including required data elements, in SAM.gov by the end of the month following the month in which the subaward obligation was made. Furthermore, pursuant to 2 CFR § 200.332(a), pass-through entities are required to clearly identify federal award information and communicate all applicable federal requirements, terms and conditions, and compliance requirements to subrecipients at the time of the subaward. Required information includes, among other items, the Assistance Listing number and name, federal award identification information, indirect cost rate and any additional requirements imposed by the pass-through entity so that subrecipients can properly administer the federal award and comply with applicable federal requirements. Condition: During testing of FFATA reporting requirements, we noted that the City had one applicable first-tier subrecipient; however, the City did not report the subaward information in SAM.gov. Additionally during testing of subrecipient monitoring, we noted the City did not communicate required federal award information or increase in funding to its sole subrecipient as required by 2 CFR § 200.332(a). Cause: The City experienced a delay in receiving the federal award and initially funded the subaward with nonfederal resources. After the federal award was received and the related expenditures were identified as federally funded, the City did not have a process to update the subaward, communicate the federal award information and funding increase to the subrecipient, or evaluate FFATA reporting requirements. As a result, the required subaward information was not reported in SAM.gov or communicated to the subrecipient. Effect or potential effect: Failure to report the applicable first-tier subaward in accordance with FFATA requirements resulted in noncompliance with federal reporting requirements and reduced transparency over the use of federal funds by preventing complete and accurate subaward information from being available through federal transparency reporting systems. In addition, failure to communicate required federal award information to the subrecipient increases the risk that the subrecipient would be unaware of applicable federal requirements and unable to properly administer the award in accordance with federal regulations and the terms and conditions of the subaward. Questioned costs: None Context: The City had one subrecipient during the audit period. The following testing was performed related to FFATA reporting: Transactions Tested -1 Subaward not reported -1 Report not timely -1 Subaward amount incorrect - Unable to test due to subaward no tbeing reported Subaward missing key elements -Unable to test due to subaward not being reported Dollar Amount of Tested Transactions - $1,045,014 Subaward not reported - $1,045,014 Report not timely - $ 1,045,014 Subaward amount incorrect -Unable to test due to subaward not being reported Subaward missing key elements - Unable to test due to subaward not being reported Additionally, we performed subrecipient monitoring testing over the sole subrecipient and identified the compliance exception described above. Identification as a repeat finding, if applicable: N/A Recommendation: We recommend the City submit any outstanding FFATA reporting information and formally notify the subrecipient of the increase in funding, applicable federal requirements, and terms and conditions of the award. We also recommend the City implement procedures to identify and assess compliance requirements when funding sources and award amounts change, including procedures to ensure required reporting, documentation, and subrecipient communications are updated timely and accurately. Views of responsible officials and planned corrective actions: Agree. See separate corrective action plan.