Finding Text
U.S. Department of Health and Human Services
93.918 – Ryan White Title C
Passed through Health Resources and Services Administration
Award Periods: April 1, 2021 to March 31, 2022, May 1, 2021 to April 30, 2022, and May 1, 2022 to April 30, 2023
Contract No. H7CHA36798-01-03, H76HA00684-22-00, and H76HA00684-23-00
Texas Department of State Health Services
State HIV Service Grants
Award Periods: September 1, 2021 to March 31, 2022 and April 1, 2022 to August 31, 2023
Contract No. 537-18-0097-00001 and HHS001022300002
Criteria: Pass-through entities are required to submit costs for reimbursement that meet the provisions of 2 CFR Subpart E. Further, under 2 CFR Section 200.303a, non-federal entities must establish and maintain effective internal controls to provide reasonable assurance that the entity is managing the federal awards in compliance with statutes, regulations, and the terms and conditions of the award.
Condition: Certain costs reimbursed to a subrecipient were not properly supported by underlying documentation. Management represented the documentation for the costs is reviewed through financial monitoring of the subrecipient which includes the subrecipient’s cost allocation plan and underlying documentation for associated with the allocation. For the fiscal year ended December 31, 2022, The Resource Group did not perform financial monitoring of its subrecipients. As a result, the cost allocation plan for one of The Resource Group’s subrecipients was not reviewed to determine appropriateness of costs allowable or allocable to the grant and costs submitted under the allocation plan and the subrecipient did not provide alternative support to The Resource Group to determine compliance.
Cause: Initially subrecipient monitoring was suspended due to COVID-19 in 2020 and reinstated late 2021. The Resource Group restarted their monitoring of subrecipients, however the monitoring was done by two individuals, one for programming and the other for financial monitoring. Monitoring of programming was completed timely, while the financial monitoring was not. Further, the Finance Director, who was responsible for the financial monitoring, resigned in 2023 and the successor Finance Director was hired in August 2023. Lastly, The Resource Group did not seek alternative documentation to support the allocated costs submitted for reimbursement as a result of not performing the financial monitoring of the subrecipient.
Effect: The Resource Group did not meet the requirements of 2 CFR Subpart E for certain costs as The Resource Group did not complete their financial monitoring of the subrecipient which would have included the review of the underlying documentation to support the costs reimbursed, nor did they request alternative documentation when the financial monitoring was not completed.
Questioned Costs: Ryan White Title C known questioned costs $497.14 (likely questioned costs $8,054.40)
State HIV Service Grants likely questioned costs $6,808.21
Recommendation: The Resource Group should follow its policies regarding expense reimbursement grants and ensure support for costs submitted for reimbursement comply with 2 CFR Subpart E.
Views of Responsible Officials: See corrective action plan.