Finding Text
Criteria or specific requirement: According to ? 2 CFR 200.332 Requirements for Pass-through Entities, all pass-through entities must evaluate each subrecipient's risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring. In addition, the pass-through entity must monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, in compliance with Federal statutes, regulations, and the terms and conditions of the subaward; and that subaward performance goals are achieved. Condition: The Organization lacked a process to complete a risk assessment that would allow the Organization to evaluate each subrecipient's risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring. Questioned costs: None. Context: We noted the Organization is not in compliance with the requirements defined within 2 CFR ?200.332(b). Cause: The Organization lacks established internal controls and procedures that ensure a risk assessment is performed on all Subrecipients. Effect: The lack of internal controls over this compliance requirement provides an opportunity for noncompliance. Appropriate subrecipient monitoring may not be determined as there are no risk assessments being performed. Repeat Finding: Yes: 2021-003 Recommendation: We recommend the Organization revise their Subrecipient Monitoring Policy to include performing subrecipient risk assessments on all subrecipient relationships that the Organization enters into. Views of responsible officials: Management concurs with the finding. While the Subrecipient Monitoring Policy was updated, Mental Health Partners did not have procedures in place to ensure risk assessments were performed on all subrecipients for each grant period. The Controller, Grants Manager, and Contracts Manager are currently updating the internal controls and procedures to ensure that risk assessments are performed for each subrecipient for each grant period in compliance with 2 CFR 200.332(b).