In response to this finding, management will take the following actions. 1. Adoption of the De Minimis Rate: The City will apply the 15% de minimis indirect cost rate, as permitted under Uniform Guidance, to applicable federal awards where a federally negotiated indirect cost rate agreement is not in place. This approach will provide consistency in the recovery of indirect costs and ensure compliance with federal requirements. 2. Formalize Procedures: The Controller's Office will develop and document procedures governing the application of indirect cost rates, including guidance on when the de minimis rate may be used, calculation methodologies, required documentation, and approval requirements. 3. Training: Training will be provided to grants management, accounting, and program staff responsible for grant budgeting, financial reporting, and reimbursement requests to ensure a clear understanding of indirect cost rate requirements and the application of the minimis rate. 4. Management Oversight: The Controller's Office will establish a periodic review process to ensure the de minimis indirect cost rate is applied consistently, calculations are accurate, and adequate supporting documentation is maintained. Any discrepancies identified during the review process will be addressed timely to ensure compliance with Uniform Guidance requirements related to Indirect Cost Recovery.