Finding Text
Criteria: According to the Regulatory Agreement, the Organization is permitted only to make cash distributions for reasonable operating expenses attributable to the Project.
Condition:The Organization mistakenly made payments to a vendor for services provided to a separate, related party.
Cause: A process control at the Management Agent to ensure that Project funds were used to pay services provided to the Organization failed to work as intended. The services were rendered to an entity with a similar name.
Effect: Project funds were used to pay for expenses provided to another entity.
Recommendation: The Organization should ensure controls in place at the Management Agent include verification that all payments made from Project funds are for services rendered to the Organization, including secondary review.
Views of Responsible Officials: The Organization agrees with the finding and the recommendation will be implemented.
Condition Status: Closed
Repeat Finding: No