Finding Text
Criteria: 2 CFR § 200.332(d) requires pass-through entities to monitor the activities of subrecipients as necessary to ensure that subawards are used for authorized purposes, in compliance with federal statutes, regulations, and the terms and conditions of the subaward, and that subaward performance goals are achieved[15]. Condition: For a selection of two subcontractors, POP Biotechnologies Inc. did not utilize a monitoring process for subrecipients. The organization did not create or maintain identifying information for all subrecipients, nor did it document monitoring activities. Cause: The organization has not developed or implemented formal subrecipient monitoring procedures, including the maintenance of required documentation. Effect or Potential Effect: Lack of subrecipient monitoring increases the risk that subawards may not be used for authorized purposes or in compliance with federal requirements, and that performance goals may not be achieved. Known Questioned Costs: None identified. Perspective Information: This deficiency was identified in both subrecipients selected for testing, suggesting a lack of systemic controls over subrecipient monitoring. Identification of Repeat Findings: This is a new finding for the current year. Recommendation: We recommend that POP Biotechnologies Inc. develop and implement formal subrecipient monitoring procedures, including maintaining identifying information for all subrecipients and documenting monitoring activities in accordance with Uniform Guidance requirements.