Finding Text
Condition:
The organization does not have documented policies and procedures for several critical federal grant
requirements, including:
Allowable, reasonable, and allocable costs
Tracking the period of performance
Financial and performance reporting
Key financial processes, such as disbursements, payroll, and grants management
Criteria:
2 CFR 200.302 requires organizations to maintain written policies and procedures for financial
management and compliance with federal regulations.
Cause:
The organization, being relatively new, has not prioritized developing these policies and procedures.
Effect:
The absence of formal guidance increases the risk of noncompliance and unallowable costs being
charged to the federal grant.
Recommendation:
The organization should prioritize developing and implementing formal written policies and procedures
for compliance with federal grant requirements.
Questioned Costs: None
Management’s Response:
The organization has established financial policies and procedures. However, we recognize that these
policies did not fully address all areas specific to federal grant requirements. As a relatively new
organization, we understand the importance of enhancing these frameworks to ensure full compliance
with federal guidelines and to properly manage federal funds.
We are committed to addressing this gap and will take immediate action to develop and implement
comprehensive policies and procedures that fully comply with all applicable federal grant requirements.
We anticipate that this process will be completed within three months, with oversight from senior
management to ensure its thoroughness and effectiveness. In addition, key financial processes,
including disbursements, payroll, and grants management, will be updated and aligned with these new
policies to ensure sound fiscal management and maintain ongoing compliance with federal standards.