Finding Text
Finding 2023-001: Material Weakness over Subrecipient Monitoring
Information on the Federal Program: Food and Drug Administration Research, CFDA 93.103
Criteria: The Uniform Guidance requires organizations to establish internal controls to detect potential noncompliance.
Condition: Management had existing controls related to subrecipient monitoring. However, these
controls were not sufficiently detailed relative to the collection of audited financial statements and
eligibility to receive funding. During 2023, for one subrecipient, HESI did not retain evidence of the
review performed of the subrecipient’s eligibility to receive funding and did not retain evidence of
the monitoring of the subrecipient’s audited financial statements.
Cause: Due to a lack of policies and procedures regarding retention of documentation for subrecipient monitoring.
Effect: Failed to comply with compliance supplement requirements related to subrecipient monitoring.
Questioned Costs: There were no material questioned costs identified.
Context: For the subrecipient chosen for testing in 2023, no evidence of monitoring the subrecipient’s eligibility to receive funding and audited financial statements was retained.
Repeat Finding: No.
Recommendation: We recommend that management establish procedures to ensure subrecipient monitoring requirements have appropriate supporting documentation retained.
Views of Responsible Officials and Planned Corrective Action: See management's response at the
Corrective Action Plan on page 30.