Finding 619364 (2022-001)

Finding 2022-001 ? Cash Management Cluster: Research and Development Cluster Grantors: National Cancer Institute and National Science Foundation Assistance Listing #?s and Titles: 93.397, Cancer Centers Support Grants and 47.049, Mathematical and Physical Sciences Award Names: Case GI SPORE, Case Comprehensive Cancer Support Grant, MRI: Acquisition of an SEM instrumented to conduct inoperando observations of materials performance under external stimuli Award Year and Number: 08/21/21-07/31/22 (CA150964), 04/01/21-03/31/22 (CA043703), 08/01/20-07/31/23 (DMR-2018167) Criteria In accordance with 2 CFR 200.305 (b), for non-Federal entities other than states, payment methods must minimize the time elapsing between the transfer of funds from the United States Treasury or the pass-through entity and the disbursement by the non-Federal entity whether the payment is made by electronic funds transfer, or issuance or redemption of checks, warrants, or payment by other means. Reimbursement is the preferred method when the requirements in paragraph (b) cannot be met, when the Federal awarding agency sets a specific condition per 2 CFR 200.208, or when the non- Federal entity requests payment by reimbursement. Per the OMB Compliance Supplement, the non-Federal entity must disburse funds for program purposes before requesting payment from the Federal awarding agency or pass-through entity. Condition In testing compliance with the cash management compliance requirement in accordance with the OMB Compliance Supplement, specifically the reimbursement method, 40 individual expenditures were tested to compare the date Case Western Reserve University (the ?University?) paid the vendor to the date the University requested sponsor reimbursement. We noted 8 instances in which reimbursement was requested from the sponsor before the University paid the vendor, as shown in the chart below. Assistance Listing # Award Number Expenditure Amount Date of Payment to Vendor Date of Reimbursement Request to Sponsor Date of Reimbursement from Sponsor 93.397 CA150964 $356 8/30/2021 8/26/2021 8/26/2021 93.397 CA043703 $269 10/4/2021 9/27/2021 9/27/2021 93.397 CA150964 $245 1/5/2022 9/27/2021 9/27/2021 93.397 CA150964 $300 1/5/2022 10/25/2021 10/25/2021 93.397 CA150964 $364 11/2/2021 10/25/2021 10/25/2021 93.397 CA043703 $895 6/2/2022 5/25/2022 5/25/2022 47.049 DMR-2018167 $2,735 6/27/2022 6/17/2022 6/17/2022 47.049 DMR-2018167 $35,000 6/27/2022 6/17/2022 6/17/2022 Cause Management?s current process when requesting reimbursement to sponsors is to ensure that the expenditures are incurred, however, payment may occur at a later date. Effect The University requested and received Federal reimbursement prior to paying vendors for the selected expenses. This is a repeat finding, in the prior year two exceptions were noted related to this finding. Questioned Costs None as reimbursement was requested for allowable costs. Recommendation The University should revisit existing internal control procedures to ensure requested reimbursements are received in compliance with Federal reimbursement requirements in the Compliance Supplement. Management?s Views and Corrective Action Plan Management?s response is included in ?Management?s Views and Corrective Action Plan? included at the end of this report after the summary schedule of prior audit findings and status.