Finding Text
Criteria:
Subrecipient Monitoring - Non-profit entities must follow the requirements for pass-through entities set out at 2 CFR part 200.332.
Condition:
Lack of documentation of subrecipient monitoring including risk assessment and whether the subrecipient is disqualified. Also, there as no indication of notification of the federal award identification number and amount of federal funds.
Cause:
The Organization has established policies over subrecipient monitoring and federal award identification in accordance with 2 CFR 200.332(b); however, methods for documentation of certain monitoring procedures are not formally established. Also, method for documentation of communication on federal award identification number and amount of federal funds is not contained within subaward notification on the subaward notice.
Effect:
The Organization does not have adequate documentation evidencing subrecipient monitoring procedures were performed or that all required information relating to federal awards was provided to subrecipients.
Context:
A sample of three disbursements totaling $95,377 were tested from a population of 14 transactions totaling $127,079.
Questioned costs:
No known or likely questioned cost in excess of $25,000.
Repeat Finding:
No
Recommendation:
We recommend the Organization establish a formal methodology for documenting subrecipient monitoring and adhere to its policies for communicating federal award identification in accordance with 2 CFR 200.332.
Views of responsible officials of the auditee:
The Organization concurs with the finding and will implement the following:
Develop additional policies and procedures that require documentation of subrecipient monitoring including a risk assessment for each subrecipient
Revise all federal subrecipient contracts to include federal award identification number and the amount of federal funds awarded to each subrecipient
Distribute policies and procedures and contract templates to all applicable finance and programmatic staff
Train staff on the new policies and procedures