Finding Text
Federal Agency: Department of Health and Human Services
Federal Program: Teenage Pregnancy Prevention Program
Federal Assistance Listing Number(s): 93.297
Award Period: July 1, 2023 to June 30, 2024
Type of Finding:
• Significant Deficiency in Internal Control over Compliance
• Compliance – Other Matters
Criteria or Specific Requirement: As a pass-through entity, the Organization has certain requirements listed in 2 CFR § 200.332 related to funds passed through to subrecipients, including required information in subaward agreements. There are also requirements related to ongoing monitoring of the subrecipient.
Condition: Based on testing, it was identified one subaward agreement lacked key details, such as acknowledgement of federal funding and applicable compliance requirements under the subaward. Furthermore, the Organization did not obtain or review the most recent single audit reports and there was also no documented review performed to substantiate the timely completion of the annual desk audit, as required under the Organization’s subrecipient monitoring policy.
Questioned Costs: None
Context: Two subrecipients were tested as part of audit procedures performed, noting that the most recent audit had not been obtained for one subrecipient. We also noted missing or unclear documentation around the oversight procedures, specifically documentation to support the annual desk audit was performed as outlined in the Organization's policies.
Cause: The Organization did not have proper policies and procedures in place. Additionally, certain policies outlined in the fiscal policies manual were not adequately documented. This occurred during a time of organizational re-structuring and turnover which may have led to the lapses in controls over monitoring.
Effect: Inadequate monitoring procedures may not detect subrecipient noncompliance on a timely basis.
Repeat Finding: No
Recommendation: We recommend the Organization enhance its policies and procedures to ensure adequate oversight and monitoring of subrecipients throughout the subaward period, including reviewing audit reports on a timely basis, actively following up with subrecipients on any audit findings to verify corrective action is being taken, and clearly documenting an annual desk review. Additionally, the Organization should ensure it provides subrecipients with clear information on the federal award, including the federal assistance listing number, as well as the federal requirements applicable under the agreement. This information should be written into the subaward agreement and signed by both parties.
Views of Responsible Official: There is no disagreement with the audit finding.