Finding Text
Material Weakness in Internal Control over Compliance and Noncompliance – Subrecipient Monitoring IDENTIFICATION OF FEDERAL PROGRAM: 64.033 VA Support Services for Veteran Families Program Award 20-AK-152 Department of Veterans Affairs. CRITERIA: Per Part 3 of the Uniform Guidance Compliance Supplement, A pass-through entity (PTE) must: - Identify the Award and Applicable Requirements- clearly identify to the subrecipient: (1) the award as a subaward at the time of subaward (2) all requirements imposed by the PTE on the subrecipient so that the federal award is used in accordance with federal statutes, regulations, and the terms and conditions of the award. - Evaluate Risk - evaluate each subrecipient's risk of noncompliance for the purpose of determining the appropriate subrecipient monitoring related to the subaward. - Monitor - monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, complies terms and conditions of the subaward, and achieves performance goals. CONDITION: The Mission was unable to provide documentation that the evaluation of risk and monitoring of the activities of the subrecipient was performed. CAUSE: The Mission has had turnover in all management positions since the fiscal year ended March 31, 2021. Prior management did not maintain complete or accurate files. EFFECT OR POTENTIAL EFFECT: The Mission’s current management was unable to provide records showing that the evaluation and monitoring of subrecipients was performed. QUESTIONED COSTS: None. CONTEXT: The Mission entered into 3 subawards during the period under audit. The sub awardees were approved in the SSVF program budget by the federal agency. There were 116 disbursements made to the 3 subrecipients. The auditor selected a random sample of 12 disbursements to test against supporting documentation showing that the Mission monitored the sub awardees, none of that documentation was available for inspection. IDENTIFCATION OF REPEAT FINDING: Not Applicable. RECOMMENDATION: We recommend that as a part of the Mission’s internal control structure over compliance with subrecipient monitoring requirements to establish monitoring procedures to ensure federal subrecipient requirements are
met and proof of evaluation and monitoring is maintained. VIEWS OF RESPONSIBLE OFFICIALS: See Corrective Action Plan