Finding 390838 (2023-007)

Material Weakness
Requirement
M
Questioned Costs
-
Year
2023
Accepted
2024-04-01
Audit: 301557
Organization: County of Solano (CA)
Auditor: Eide Bailly LLP

AI Summary

  • Core Issue: The County failed to properly monitor a subrecipient, treating them as a contractor instead, which led to noncompliance with federal requirements.
  • Impacted Requirements: Key compliance elements from 2 CFR 200.331 regarding subrecipient agreements, risk assessments, and monitoring activities were not met.
  • Recommended Follow-Up: The County should create clear procedures to differentiate between contractors and subrecipients to ensure compliance moving forward.

Finding Text

Program: Highway Planning and Construction Federal Financial Assistance Listing No.: 20.205 Federal Agency: U.S. Department of Transportation Passed-through: California Department of Transportation Award Number and Year: 5923, 2022/2023 Compliance Requirement: Subrecipient Monitoring Type of Finding: Material Weakness in Internal Control over Compliance, Material Noncompliance Criteria: 2 CFR 200.331(a) establishes the required elements that the pass-through entity (County) must include in their subrecipient agreements. 2 CFR 200.331(b) establishes the requirement that the pass-through entity must evaluate the risk of noncompliance with Federal statutes, regulations, and terms and conditions of the program for each subaward for the purpose of determining the appropriate subrecipient monitoring activities. 2 CFR 200.331(d) and 2 CFR 200.331(e) establishes the requirement that the pass-through entity must monitor the activities of each subrecipient of program funds to ensure that the subaward is used for authorized purposes, complies with the terms and conditions of the subaward and achieves performance goals. 2 CFR 200.331(d) requires that the monitoring activities must include: 1) Reviewing of financial and performance reports as required by the pass-through entity. 2) Following-up and ensuring that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the Federal award provided to the subrecipient from the pass-through entity detected through audits, on-site reviews, and other means. 3) Issuing a management decision for audit findings pertaining to the Federal award provided to the subrecipient from the pass-through entity as required by §200.521 Management decision. 2 CRF 200.331(f) establishes the requirement for the pass-through entity to verify whether the subrecipient is subject to a single audit when the subrecipient’s expenditures are expected to exceed the threshold set forth in 2 CRF 200.501. Condition: In 1 out of 1 instance selected, we found that the subrecipient agreement did not contain the federal award identification elements required to be communicated by the County, no risk assessment was performed, and no subrecipient monitoring was performed. In this same instance, a documented review of whether the subrecipient was subject to a single audit was also not performed. single audit in the period the expenditures were incurred. Cause: The County improperly identified the subrecipient as a contractor. The County did not perform an evaluation of the agreement to determine whether the vendor was a contractor or a subrecipient. Effect: The County did not comply with the subrecipient monitoring compliance requirements. Questioned Costs: None reported. Context/Sampling: We selected 100% of the County’s subrecipients of the program. Repeat Finding from Prior Year(s): No. Recommendation: We recommend that the County establish procedures to determine whether agreements represent a contractor or a subrecipient arrangement. Views of Responsible Officials: Management agrees with the finding. See separate corrective action plan.

Corrective Action Plan

Federal Agency: U.S. Department of Transportation Program/Cluster: Highway Planning and Construction Federal Assistance Listing Number: 20.205 Pass‐through: California Department of Transportation Award No. and Year: 5923, 2022/2023 Compliance Requirement: Subrecipient Monitoring Type of Finding: Material Weakness in Internal Control over Compliance, Material Noncompliance Views of Responsible Officials and Corrective Action Plan: Management agrees with the finding. All Public Works contracts receiving federal funding will be evaluated to determine if the vendor is a contractor or subrecipient going forward. This practice is already followed for the other divisions within the Department, and Public Works will now be included. Responsible Individual(s): James Bezek, Director of Resources Management Anticipated Completion Date: June 30, 2024

Categories

Subrecipient Monitoring

Other Findings in this Audit

  • 390825 2023-002
    Material Weakness Repeat
  • 390826 2023-002
    Material Weakness Repeat
  • 390827 2023-003
    Material Weakness Repeat
  • 390828 2023-003
    Material Weakness Repeat
  • 390829 2023-004
    - Repeat
  • 390830 2023-004
    - Repeat
  • 390831 2023-004
    - Repeat
  • 390832 2023-005
    Material Weakness Repeat
  • 390833 2023-005
    Material Weakness Repeat
  • 390834 2023-005
    Material Weakness Repeat
  • 390835 2023-006
    - Repeat
  • 390836 2023-006
    - Repeat
  • 390837 2023-006
    - Repeat
  • 390839 2023-008
    Material Weakness
  • 390840 2023-008
    Material Weakness
  • 390841 2023-008
    Material Weakness
  • 967267 2023-002
    Material Weakness Repeat
  • 967268 2023-002
    Material Weakness Repeat
  • 967269 2023-003
    Material Weakness Repeat
  • 967270 2023-003
    Material Weakness Repeat
  • 967271 2023-004
    - Repeat
  • 967272 2023-004
    - Repeat
  • 967273 2023-004
    - Repeat
  • 967274 2023-005
    Material Weakness Repeat
  • 967275 2023-005
    Material Weakness Repeat
  • 967276 2023-005
    Material Weakness Repeat
  • 967277 2023-006
    - Repeat
  • 967278 2023-006
    - Repeat
  • 967279 2023-006
    - Repeat
  • 967280 2023-007
    Material Weakness
  • 967281 2023-008
    Material Weakness
  • 967282 2023-008
    Material Weakness
  • 967283 2023-008
    Material Weakness

Programs in Audit

ALN Program Name Expenditures
93.563 Child Support Enforcement $7.68M
20.205 Highway Planning and Construction $3.38M
14.871 Section 8 Housing Choice Vouchers $3.13M
10.557 Special Supplemental Nutrition Program for Women, Infants, and Children $2.71M
93.778 Medical Assistance Program $2.36M
93.224 Consolidated Health Centers (community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) $1.73M
93.224 Covid-19 Consolidated Health Centers (community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) $1.31M
93.044 Special Programs for the Aging_title Iii, Part B_grants for Supportive Services and Senior Centers $826,610
21.027 Covid-19 Coronavirus State and Local Fiscal Recovery Funds $596,260
16.575 Crime Victim Assistance $593,209
93.659 Adoption Assistance $553,181
10.561 State Administrative Matching Grants for the Supplemental Nutrition Assistance Program $505,023
93.498 Covid-19 Provider Relief Fund $463,799
93.994 Maternal and Child Health Services Block Grant to the States $388,673
16.738 Edward Byrne Memorial Justice Assistance Grant Program $349,914
93.918 Grants to Provide Outpatient Early Intervention Services with Respect to Hiv Disease $341,429
20.608 Minimum Penalties for Repeat Offenders for Driving While Intoxicated $334,090
93.667 Social Services Block Grant $329,728
93.658 Foster Care_title IV-E $312,354
93.556 Promoting Safe and Stable Families $301,061
16.606 State Criminal Alien Assistance Program $298,259
93.052 National Family Caregiver Support, Title Iii, Part E $291,617
97.067 Homeland Security Grant Program $251,279
93.889 National Bioterrorism Hospital Preparedness Program $240,451
93.391 Activities to Support State, Tribal, Local and Territorial (stlt) Health Department Response to Public Health Or Healthcare Crises $226,463
93.045 Special Programs for the Aging_title Iii, Part C_nutrition Services $217,908
93.526 Covid-19 Affordable Care Act (aca) Grants for Capital Development in Health Centers $211,510
93.069 Public Health Emergency Preparedness $208,837
93.053 Nutrition Services Incentive Program $207,308
93.268 Immunization Cooperative Agreements $182,180
93.354 Covid-19 Public Health Emergency Response: Cooperative Agreement for Emergency Response: Public Health Crisis Response $161,633
93.674 John H. Chafee Foster Care Program for Successful Transition to Adulthood $148,008
17.258 Wia Adult Program $139,508
93.645 Stephanie Tubbs Jones Child Welfare Services Program $134,957
20.616 National Priority Safety Programs $127,440
93.958 Covid-19 Block Grants for Community Mental Health Services $120,486
17.278 Wia Dislocated Worker Formula Grants $113,074
93.958 Block Grants for Community Mental Health Services $106,592
59.037 Small Business Development Centers $104,192
16.034 Covid-19 Coronavirus Emergency Supplemental Funding Program $97,487
93.090 Guardianship Assistance $85,194
93.116 Project Grants and Cooperative Agreements for Tuberculosis Control Programs $85,050
93.940 Hiv Prevention Activities_health Department Based $82,288
93.747 Elder Abuse Prevention Interventions Program $72,639
93.042 Special Programs for the Aging_title Vii, Chapter 2_long Term Care Ombudsman Services for Older Individuals $72,071
93.558 Temporary Assistance for Needy Families $71,379
14.879 Mainstream Vouchers $66,358
14.896 Family Self-Sufficiency Program $60,668
16.742 Paul Coverdell Forensic Sciences Improvement Grant Program $49,554
93.043 Special Programs for the Aging_title Iii, Part D_disease Prevention and Health Promotion Services $47,877
97.042 Emergency Management Performance Grants $46,060
15.605 Sport Fish Restoration Program $45,942
93.870 Maternal, Infant and Early Childhood Home Visiting Grant $43,042
17.277 Workforce Investment Act (wia) National Emergency Grants $42,869
93.590 Community-Based Child Abuse Prevention Grants $35,923
93.150 Projects for Assistance in Transition From Homelessness (path) $35,911
93.044 Covid-19 Special Programs for the Aging_title Iii, Part B_grants for Supportive Services and Senior Centers $25,037
17.259 Wia Youth Activities $25,003
93.917 Hiv Care Formula Grants $22,479
93.197 Childhood Lead Poisoning Prevention Projects_state and Local Childhood Lead Poisoning Prevention and Surveillance of Blood Lead Levels in Children $19,857
93.959 Block Grants for Prevention and Treatment of Substance Abuse $19,601
16.U02 Safe Streets Violent Crimes Initiative $17,387
16.U03 2022 Domestic Cannabis Eradication Suppression Program $15,381
10.025 Plant and Animal Disease, Pest Control, and Animal Care $15,079
93.323 Covid-19 Epidemiology and Laboratory Capacity for Infectious Diseases (elc) $6,795
93.603 Adoption Incentive Payments $6,196
93.052 Covid-19 National Family Caregiver Support, Title Iii, Part E $4,169
93.041 Special Programs for the Aging_title Vii, Chapter 3_programs for Prevention of Elder Abuse, Neglect, and Exploitation $3,144
93.747 Covid-19 Elder Abuse Prevention Interventions Program $2,171
93.042 Covid-19 Special Programs for the Aging_title Vii, Chapter 2_long Term Care Ombudsman Services for Older Individuals $1,562
16.U04 2023 Domestic Cannabis Eradication Suppression Program $1,435
20.106 Covid-19 Airport Improvement Program $527
93.566 Refugee and Entrant Assistance_state Administered Programs $195
93.045 Covid-19 Special Programs for the Aging_title Iii, Part C_nutrition Services $105