Finding Text
Assistance Listing Number, Federal Agency, and Program Name – 59.059, U.S. Small Business Administration, Congressional Grants
Federal Award Identification Number and Year SBAHQ23I0070, 2023
Pass through Entity – Not applicable
Finding Type Material weakness and material noncompliance with laws and regulation
Repeat Finding – No
Criteria – Per CFR 200.302, the Organization must maintain written procedures to implement the requirements of CFR 200.305. Under these Federal payment requirements, the Organization must maintain advance payments of Federal awards in interest-bearing accounts. Any interest earned on Federal advance payments above $500 must be remitted annually to the Department of Health and Human Services Payment Management System (PMS).
Condition – The Organization does not have written procedures to implement the requirements of CFR 200.305. The advance payment of the Federal award was not maintained in an interest-bearing account and no interest was remitted back to the Federal government.
Questioned Costs Not applicable
Identification of How Questioned Costs Were Computed Not applicable.
Context – There was only one advance payment of Federal awards received during 2023 which amounted to $921,000.
Cause and Effect – Policies and procedures and related internal controls did not ensure compliance with Federal payment requirements under Uniform Guidance.
Recommendation - We recommend establishing and maintaining written procedures to ensure 1) advance payments of Federal Awards are maintained in interest-bearing accounts; 2) interest earned is monitored; 3) interest earned above $500 is remitted at least annually.
Views of Responsible Officials and Corrective Action Plan – The Organization acknowledges receipt of the finding. The following corrective actions have been taken:
Management is in the process of updating written procedures for Federal award compliance. Management will calculate and remit interest for 2023 to the Department of Health and Human Services Payment Management System (PMS).