Finding Text
Finding Number 2022-002
Federal programs:
AL No.: 93.044 Special Programs for the Aging-Title III, Part B-Grants for Supportive Services
and Senior Centers
AL No.: 93.045 Special Programs for the Aging-Title III, Part C-Nutrition Services
Category:
Internal Control/Compliance Material Weakness
Compliance Requirement:
Subrecipient Monitoring
Condition:
OAE requires the monitoring process of 100% of the population of the subrecipients of federal funds, at least
once a year. During the year ended September 30, 2022, the OAE distributed federal funds to 123 subrecipients.
However, the subrecipients subjected to formal monitoring were only thirteen (13) or 11%.
Criteria:
45 CFR Sections 1321.11(b) and 1321.17(f)(9), the State Agency is required to develop policies governing all
aspects of programs operated under the State Plan and to monitor their implementation, including assessing
performance for quality and effectiveness and specifying data system requirements to collect necessary and
appropriate data. The policies developed by the State agency shall address the manner in which the State agency
will monitor the performance of all programs and activities initiated under this part for quality and effectiveness.
Cause:
For the year ended September 30, 2022, the OAE had not yet reviewed the design of its policies for the
monitoring activities over subrecipients. These policies do not consider that there are no current or contemplated
resources that could be available to perform formal and comprehensive monitoring exercises over the total
population of sub-recipients on an annual basis.
Effect: The failure to monitor sub-recipients may lead to inappropriate use of the funds by the subrecipients, and the
disallowance of such costs by the federal agencies.
Questioned Cost:
None.
Recommendation:
OAE should review the design of the internal policies according to the available resources and modify what is
established in the State Plan regarding the monitoring of subrecipients. The monitoring processes should be
designed to ensure that the grants were used properly, and all supporting documents were properly assembled
and stored. Best practices on subrecipients monitoring should be searched and evaluated for implementation.
Management Response:
Management agrees with the observation. OAE reviewed its policies and procedures for subrecipients
monitoring and developed and adopted a risk base plan to comply with the requirements. The subject plan was
adopted for implementation effective April 23, 2024. Under the new plan, the monitoring activities will entail a
risk-based monitoring approach to streamline the related processes. The benefits of the implementation of new
policies will be reviewed starting during the year ending September 30, 2024.