Finding Text
2024-002 Finding – Federal Award
Type:
Special Reporting - Federal Funding Accountability and Transparency Act (FFATA) – Material Non-
Compliance and Material Weakness in Internal Controls over Compliance. (Repeat of finding 2023-003)
Identification of Federal Program:
AL Number: 64.033 Supportive Services for Veteran Families
Criteria / Requirement:
2 CFR section 200.303 requires that non-federal entities receiving federal awards establish and maintain
internal control over the federal awards that provides reasonable assurance that the non-federal entity is
managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions
of the federal awards.
Under the requirements of the Federal Funding Accountability and Transparency Act (Pub. L. No. 109-282),
as amended by Section 6202 of Pub. L. No. 110-252, that are codified in 2 CFR Part 170, recipients (i.e.,
direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000
or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS).
The subawards meeting the above definition are to be reported no later than the last day of the month
following the month in which the subaward/subaward amendment obligation was made or the subcontract
award/subcontract modification was made.
Condition / Context:
During the year June 30, 2024, CAT entered into three first-tier subawards greater than $30,000 under AL
number 64.033. The auditor tested one of these subawards, noting that the award was reported late under
the Federal Funding Accountability and Transparency Act to the Federal Subaward Reporting System. Per
further inquiry, all of the first-tier subawards were reported late to FSRS.
CAT was aware of the FFATA reporting requirements, but the timing of the previous year finding did not
allow for corrections during the fiscal year 2024. Procedures were not in place to track and report first-tier
subawards within the time frame required by federal requirements.
Effect:
Failure to maintain sufficient internal controls and proper procedures, including identifying compliance
requirements of grant agreements and tracking over reporting first-tier subawards may result in wrongful
use of federal funds and non-compliance with federal awards.
Questioned Costs:
None.
Recommendation:
The Organization should establish written policies and procedures regarding review of grant agreements
for compliance requirements along with written policies and procedures for first-tier subawards including
tracking and proper internal control procedures.
Management’s Response:
Management concurs with the finding and has defined corrective action to address it. We have identified
gaps in our reporting processes and worked to implement changes to ensure compliance with special
reporting requirements. Policies and procedures will be updated regarding special reporting requirements.
The Fiscal department will also be responsible for reviewing all contracts to identify all compliance
requirements. Tracking procedures will be implemented to ensure reports are filed timely. The above
identified corrective action was implemented in July 2024. Stacey Wilson, Fiscal Director, has implemented
a tracking system for the FFATA.