Finding 565819 (2024-002)

Material Weakness
Requirement
C
Questioned Costs
-
Year
2024
Accepted
2025-06-23
Audit: 359527
Organization: The Nazareth Project, Inc. (PA)

AI Summary

  • Core Issue: The Organization delayed remitting grant funds to the subrecipient, missing the two-day requirement.
  • Impacted Requirements: This delay violates the Cash Management requirements of the Foreign Assistance program.
  • Recommended Follow-Up: The Organization should implement daily monitoring of its bank account after applying for reimbursements to ensure timely fund transfers.

Finding Text

Criteria: Grant funds reimbursed to The Nazareth Project, Inc. (the "Organization") under the Foreign Assistance to American Schools and Hospitals Abroad program are remitted to the Nazareth Hospital (the subrecipient) within two business days. Condition: The Organization received a grant reimbursement on September 15, 2023, but remitted those funds to the subrecipient on September 26, 2023. Cause of Condition: The Organization's Executive Director was not monitoring the bank account where the Organization receives its federal award funds because he expected a longer lag time between application for reimbursement and receipt of the funds. Potential Effect of Condition: Noncompliance with the Cash Management requirements of the program. Recommendation: The Organization should monitor its bank account daily after application for reimbursement under the federal award program until funds are received to ensure timely remittance. Questioned Costs: None

Corrective Action Plan

Management's Response and Corrective Action Plan: In past experience with USAID reimbursement requests, payment was received 10-14 days after the request for reimbursement was submitted to the office of CFO.CMP Electronic Invoices (USAID). For example, on October 11, 2022, we submitted a request for $308,942.22. Payment was received on October 28, 2022 – 17 days after the request for reimbursement. In the specific case of reimbursement received on September 15, 2023, NPI submitted the request for reimbursement on September 13. In this specific case reimbursement was received within only two days. We acknowledge our failure to remit grant funds to the Nazareth Hospital on a timely basis. For future grant reimbursement requests, we have implemented a plan to be more diligent in monitoring the receipt of grant reimbursements to ensure that we can immediately disburse them to the recipient.

Categories

Subrecipient Monitoring Cash Management

Other Findings in this Audit

  • 565820 2024-001
    Significant Deficiency
  • 1142261 2024-002
    Material Weakness
  • 1142262 2024-001
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
98.006 Foreign Assistance to American Schools and Hospitals Abroad (asha) $953,286