Finding 977849 (2023-001)

Identification of the federal programs 12.800 - Air Force Defense Research Sciences Program - FA8650-20-2-5506. Criteria or Specific Requirement Per 2 CFR Part 200 Subpart F section 200.502, amounts provided to subrecipients should be reported as expended when the disbursement is made to the subrecipient. Condition The Organization recorded disbursements made to subrecipients in the incorrect fiscal year period on the Schedule of Expenditures of Federal Awards. Cause The Organization recorded the expenses in accordance with GAAP rather than with the CFR compliance on the Schedule of Expenditures of Federal Awards. As such the Organization incorrectly incurred expenses in the wrong fiscal year period for the purposes of the single audit. Effect or potential effect Subrecipient expenditures are recorded in the incorrect year. Questioned Costs None noted. Context The condition noted above was identified during the audit procedures related to Subrecipient Monitoring. Identification as a Repeat Finding None Recommendation The Organization should have a formal process put in place to ensure subrecipient expenditures are being recorded in the proper period. Views of Responsible Officials Management concurs with the finding. The Organization revised its review procedures and controls so that subrecipient expenditures are recorded in the proper accounting fiscal year according to 2 CFR Part 200 Subpart F section 200.502, whereby amounts will be reported as expended when the disbursement is made to the subrecipient for single audit purposes. These steps should correct the deficiency.