Finding Text
Finding 2024-006 Finding Type: Noncompliance and significant deficiency in internal control Federal Department: U.S. Department of Health and Human Services, Centers for Disease Control and Prevention Identification of the Federal Program: Assistance Listing Number 93.988 – Cooperative Agreements for Diabetes Control Programs Award Number: NU58DP007394 Compliance Requirement(s): Subrecipient Monitoring Criteria: Per 2 CFR Part 200.332(g), a pass-through entity must verify that a subrecipient is audited as required by 2 CFR Part 200, Subpart F. Per 2 CFR Part 200.332(e), a pass-through entity must: 1) Ensure that the subrecipient takes corrective action on all significant developments that negatively affect the subaward. Significant developments include Single Audit findings related to the subaward, other audit findings, site visits, and written notifications from a subrecipient of adverse conditions which will impact their ability to meet the milestones or the objectives of a subaward. When significant developments negatively impact the subaward, a subrecipient must provide the pass-through entity with information on their plan for corrective action and any assistance needed to resolve the situation, 2) Issue a management decision for audit findings pertaining only to the federal award provided to the subrecipient from the pass-through entity as required by 2 CFR Part 200.521, and 3) Resolve audit findings specifically related to the subaward. However, the pass-through entity is not responsible for resolving cross-cutting audit findings that apply to the subaward and other federal awards or subawards. If a subrecipient has a current Single Audit report and has not been excluded from receiving federal funding (meaning, has not been debarred or suspended), the pass-through entity may rely on the subrecipient's cognizant agency for audit or oversight agency for audit to perform audit follow up and make management decisions related to cross-cutting audit findings in accordance with 2 CFR Part 200.513(a)(4)(viii). Such reliance does not eliminate the responsibility of the pass-through entity to issue subawards that conform to agency and award-specific requirements, to manage risk through ongoing subaward monitoring, and to monitor the status of the findings that are specifically related to the subaward. Condition: We selected six AL #93.988 subrecipients for testing from a population of six subrecipients. For all six subrecipients, the Imperative did not verify whether their subrecipients were subject to audit as required by 2 CFR Part 200, Subpart F (Single Audit). Since the Imperative did not obtain or review their subrecipients’ Single Audit reports, the Imperative was unable to ensure the subrecipient took corrective action on any significant developments that negatively affected the subaward, issue management decisions for audit findings pertaining to the federal award provided to the subrecipient or resolve audit findings specifically related to the subaward. Cause: This finding occurred due to oversight. Effect: Failure to adequately communicate and monitor the activities and performance of a subrecipient could result in federal awards being used for unauthorized purposes and the Imperative’s inability to adequately perform risk assessments on its subrecipient(s). Questioned Costs: None. Repeat Finding: Not applicable. Recommendation: We recommend that the Imperative implement procedures to ensure compliance with subrecipient monitoring requirements. View of Responsible Officials: See management’s corrective action plan.