The U.S. National Science Foundation Resolution and Advanced Monitoring (RAM) branch is responsible for resolving compliance, internal controls, and questioned cost findings identified in audits of NSF awardees.
Organizations must cooperate with NSF to promptly resolve all audit findings to avoid:
- Jeopardizing current or future NSF funding.
- Cost disallowances that require repayments to NSF.
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About audits
2 CFR 200 Subpart F, "Audit Requirements," requires an annual audit of non-federal entities, including tribes, that expend $1,000,000 or more of federal financial assistance funding in a Fiscal Year.
Single Audits must be performed by an independent auditor and the reporting package (which includes the audit report) must be submitted to the Federal Audit Clearinghouse within 30 days after your organization receives its audit report or nine months from your organization's Fiscal Year end.
Audit resolution process
For Office of Inspector General audits (see "Circular No. A-50 Revised"), audit resolution is the point at which NSF and the NSF Office of Inspector General agree on actions to be taken by the organization on reported findings and recommendations. NSF will work with audited entities to ensure acceptable corrective actions in response to the audit findings and recommendations are developed.
When audit findings are particularly egregious, audited entities will be required to prepare a detailed corrective action plan describing the steps to be taken and outlining the associated timeframes to satisfactorily resolve the audit findings. However, final actions may still be required by audited entities (e.g., repayment or implementation of revised policies and procedures) and/or NSF (e.g., amendment of an active award) to close out or resolve any findings and questioned costs.
The following are examples of common issues that may result in questioned costs and subsequent cost disallowances:
- Lack of adequate documentation to support costs (participant support, compensation, subrecipients, etc.) charged to NSF awards (see 2 CFR 200.302(b)(3)).
- Failure to perform and document monitoring and oversight activities of subrecipients, their compliance, and/or expenditures charged to NSF awards (see 2 CFR 200.332).
- Allocation of indirect cost recovery charges to participant support costs or overcharging indirect costs under NSF awards.
- Charging costs that are unallowable per 2 CFR 200 Subpart E (federal cost principles) and, therefore, cannot be charged to federal awards.
- Failure to establish, document and follow policies and procedures for proper allocation of end-of-award purchases (see 2 CFR 200.405).
- Failure to obtain prior NSF grant officer approval before rebudgeting/reallocating funds approved for participant support to other cost categories.
- Use of participant support costs for ineligible awardee employees (e.g., employees receiving compensation (salary) under the grant that is also providing them participant support).
- Failure to follow the policies and procedures established in place at the awardee entity (see 2 CFR 200.303 "Internal controls").
NSF communication regarding audit resolution is usually coordinated through the organization's authorized organizational representative. Audited entities are responsible for submitting responses, documentation and, in some cases, corrective action plans to satisfactorily respond to audit findings.
To resolve audit report findings, NSF may coordinate with other federal agencies in cases where NSF is not the cognizant or the Office of Management and Budget-specified oversight agency, especially when systemic issues (audit findings affecting awards from more than one agency) are identified in the audit report.
In some cases, NSF may issue a unilateral decision if the audit finding is straightforward, or if the audited organization is uncooperative or unresponsive.
Audit findings are typically resolved within six months of an audit report being issued. However, the complexity of the audit findings and questioned costs can lengthen the audit resolution process.
For audit findings that remain unresolved after six months, NSF RAM is required to report the status to NSF senior management and the NSF Office of Inspector General. NSF also reports all open audit recommendations that have not been implemented by audited entities within six months of report issuance in the Office of Inspector General Semiannual Report to Congress.
Contact us
If you have questions about NSF's audit resolution process, contact diasauditresolution@nsf.gov.
To inquire about an extension for submission of a Single Audit Report, contact: singleauditextensions@nsf.gov.
