417 FW 1, Service-Administered Audits of Grantees - Overview, Fish and Wildlife Service Manual, U.S. Fish and Wildlife Service

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417 FW 1
Service-
Administered Audits of Grantees - Overview

Supersedes 417 FW 1, FWM 454, 08/23/04

Date: April 19, 2010

Series: Audits

Part 417: Wildlife and Sport Fish Restoration Program Audits

Originating Office: Office of Wildlife and Sport Fish Restoration

PDF Version

1.1 What is the purpose of this chapter? This chapter:

A. Gives employees an overview of Service-administered audits of grantees in the Wildlife and Sport Fish Restoration Program (WSFR), and

B. Describes the program authorities and responsibilities for all the chapters in Part 417.

1.2 To which grant programs does this chapter apply? This chapter applies to Service-administered audits, which are examinations of the grant programs that WSFR administers. If WSFR shares responsibility with another entity for a grant program, the chapter applies only to those grants in the program that WSFR administers.

A. Mandatory audits. The Service must audit grantees for the programs and subprograms in Table 1–1 at least once every 5 years (also see section 1.7). The table includes the Catalog of Federal Domestic Assistance (CFDA) numbers for each program.

Table 1–1: Grant Programs We Must Audit

CFDA #

Program

15.605

15.611

15.626

Sport Fish Restoration:

Recreational Boating Access subprogram

Outreach and Communications subprogram

Aquatic Resource Education subprogram

Wildlife Restoration (Hunter Education and Safety subprogram)

Hunter Education and Safety (Enhanced Hunter Education and Safety)

B. Discretionary audits. The Service may audit grantees at its discretion for the grant programs and subprograms in Table 1–2:

Table 1–2: Grant Programs We May Audit

CFDA #

Program

CFDA #

Program

15.614

15.615

15.616

15.622

15.625

15.628

15.633

Coastal Wetlands Planning, Protection, and Restoration Act

(National Coastal Wetlands Conservation Act Grants)

Cooperative Endangered Species Conservation Fund

Clean Vessel Act

Sportfishing and Boating Safety Act (Boating Infrastructure Grants)

Wildlife Conservation and Restoration Program

Multistate Conservation Grants

Landowner Incentive Program

15.634

15.638

15.639

15.649

15.650

—

State Wildlife Grants

Tribal Landowner Incentive Program

Tribal Wildlife Grants

Service Training and Technical Assistance (Generic Training)

Research Grants (Generic)

Highlands Conservation

Everglades Restoration

Fisheries Restoration and Irrigation Mitigation

Partnerships for Wildlife

1.3 What are the authorities for the chapters in Part 417? The authorities for this program are:

A. Pittman-Robertson Wildlife Restoration Act (16 U.S.C. 669 et seq.) and Dingell-Johnson Sport Fish Restoration Act (16 U.S.C. 777 et seq., except 777e–1 and g–1).

B. Administrative and Audit Requirements and Cost Principles for Assistance Programs (43 CFR 12).

C. Administrative Requirements, Pittman-Robertson Wildlife Restoration and Dingell-Johnson Sport Fish Restoration Acts (50 CFR 80).

D. Conservation of Endangered and Threatened Species of Fish, Wildlife, and Plants–Cooperation with the States (50 CFR 81).

E. National Coastal Wetlands Conservation Grant Program (50 CFR 84).

F. Clean Vessel Act Grant Program (50 CFR 85).

G. Boating Infrastructure Grant Program (50 CFR 86).

H. 360 DM 1–3, Departmental Audits.

I. 361 DM 1, General Audit Followup Responsibilities.

J. Government Auditing Standards (Yellow Book), GAO–07–731G, United States Government Accountability Office, July 2007.

K. Office of Management and Budget (OMB) Circular A–21, Cost Principles for Educational Institutions.

L. OMB Circular A–50, Audit Follow-up.

M. OMB Circular A–87, Cost Principles for State, Local, and Indian Tribal Governments.

N. OMB Circular A–102, Grants and Cooperative Agreements with State and Local Governments.

O. OMB Circular A–110, Uniform Administrative Requirements for Grants and Agreements with Institutions of Higher Education, Hospitals, and Other Non-Profit Organizations.

P. OMB Circular A–122, Cost Principles for Non-Profit Organizations.

Q. OMB Circular A–133, Audits of States, Local Governments, and Non-Profit Organizations.

1.4 Who is responsible for the Wildlife and Sport Fish Restoration Program’s Service-administered audits of grantees? Table 1–3 lists the officials with responsibilities for the audit program.

Table 1–3: Responsibilities for the Audit Program

Officials or Offices

Responsibilities

A. The Department of the Interior’s Office of Financial Management

Oversees the resolution of auditor’s recommendations and closes all audits the Department‘s Office of Inspector General (OIG) refers to the Assistant Secretary of Policy, Management and Budget.

B. The Department‘s Office of Hearings and Appeals

Resolves appeals to the Secretary of the Interior (see 417 FW 5).

C. The Director

(1) Is responsible for ensuring that Service-administered audits of grantees take place as required (see 417 FW 1.6 for more information),

(2) Makes the final decision on Service recommendations for resolving audit findings and preparing Corrective Action Plans (CAPs),

(3) Makes the final decision on all grantee appeals to the Service, and

(4) Responds to the Department’s Office of Hearings and Appeals.

D. Regional Directors

(1) Ensure that Regional Wildlife and Sport Fish Restoration Program staff receive training necessary to oversee audits;

(2) Provide information to the auditor on Region-specific issues proposed for audits;

(3) Provide guidance and interpret laws, regulations, and policies for the auditor;

(4) Work with the grantee and auditor throughout the audit to resolve issues and to identify those issues with potential national implications;

(5) Determine whether to accept or reject the auditor’s recommendations based on applicable laws, regulations, and policies;

(6) Negotiate with grantees to develop a CAP to resolve audit findings, approve and distribute the CAP, and track corrective actions to completion;

(7) With the Assistant Director–WSFR, brief the Director when there is a disagreement between the Regional Director and the Assistant Director–WSFR on the CAP;

(8) Request a closeout of the audit when the grantee resolves all findings and completes all corrective actions;

(9) Retain the final audit report, CAP, resolutions, and other documentation as Service and Departmental policy requires;

(10) Notify the grantees of the audit schedule; and

(11) Respond to grantees’ written complaints on the conduct or scope of an audit.

E. The Assistant Director for Wildlife and Sport Fish Restoration (AD–WSFR)

(1) Ensures consistent interpretation and application of laws, regulations, and policies that affect audits;

(2) Establishes the national audit schedule;

(3) Reviews and concurs with the draft CAPs before they go to the OIG;

(4) With the Regional Director, briefs the Director when there is a disagreement with the Regional Director on the CAP;

(5) Evaluates audits for efficiency, timeliness, and effectiveness; and

(6) Consults with States and Regional Directors to identify issues and consider recommendations for improving audits.

F. The Chief, Division of Administration and Information Management, Headquarters (Chief-AIM/HQ)

(1) Advises the AD–WSFR on audit scheduling;

(2) Coordinates audits, ensures an independent audit of grantees, and serves as a point of contact for Service staff and the auditor;

(3) Requires that audits are conducted following Government Auditing Standards and Federal laws, regulations, and policies;

(4) Identifies national audit training needs for HQ staff and auditors.

(5) Establishes audit objectives;

(6) Develops and maintains the Service handbook, “Audit Guide for Wildlife and Sport Fish Restoration Program,” and ensures the auditor follows it for appropriate grant programs;

(7) Reports on common findings from ongoing audits and their resolutions, as needed, without breaching the confidentiality of the audit process; and

(8) Provides technical help on audit issues to the Regional Director and the AD–WSFR.

G. The Chief, Division of Policy and Directives Management (Chief-PDM)

(1) Oversees activities of the Service Audit Liaison Officer. The Service Audit Liaison Officer is the contact for OIG and other Departmental offices for Service-administered audits of grantees;

(2) Advises Service officials on audit liaison matters; and

(3) Tracks the audit recommendations until corrective actions are completed and reports to the Directorate and Department on follow-up.

1.5 What terms do you need to know to understand this chapter? The terms you need to know to understand this chapter are in the Service handbook, Wildlife and Sport Fish Restoration Program Glossary.

1.6 What are Service-administered audits of grantees? Service-administered audits of grantees are examinations of grantees receiving funds that WSFR administers. These audits supplement Single Audit Act audits that we perform according to OMB Circular A–133 (see 417 FW 6).

A. The auditor for Service-administered audits must be a public accountant from a private firm or a local, State, or Federal Government organization that performs audits. The Department of the Interior’s OIG is an example of an organization in the Federal Government that performs audits. The auditor must meet the general standards specified in Generally Accepted Government Auditing Standards.

B. The auditor performs an audit under contract to the Service. The AD–WSFR recommends an auditor for selection by the Director, and the Service’s Division of Contracting and Facilities Management administers the contract through a Contracting Officer. The Chief-AIM/HQ is the Contracting Officer’s Technical Representative. The auditors report to the Contracting Officer in consultation with the Contracting Officer’s Technical Representative.

C. The objectives of the audits are to:

(1) Verify compliance with:

(a) Applicable Federal laws, regulations, and the Generally Accepted Accounting Principles;

(b) Policies applicable to the program that provided the funds;

(c) Terms of the grant; and

(d) Applicable State laws and regulations;

(2) Assess financial integrity, accountability, and controls over use of Federal funds following the Generally Accepted Accounting Principles; and

(3) Deter and detect fraud and abuse in programs and operations.

1.7 What are the special audit requirements for mandatory audits? The Wildlife Restoration program, the Sport Fish Restoration program, their component subprograms, and the Enhanced Hunter Education and Safety program have the following special requirements:

A. We must audit each grantee that receives funds from these programs once for each 5-year period (audit cycle) as follows. The audit must include revenue and expenditures of:

(1) Protected State hunting and fishing license funds for the audit period, and

(2) The grant funds received during the audit period.

B. The auditor must work with the Regional Director and the grantee to determine the audit period. The Regional Director must approve the audit period. The audit period must cover the two most recently completed State fiscal years or two consecutive recently completed State fiscal years. We choose which years to cover based on such considerations as:

(1) Completion of the Single Audit. A Single Audit is an audit that a non-Federal entity must obtain from an independent auditor if it expends:

(a) $500,000 or more in a fiscal year, or

(b) Another amount specified by OMB. The auditor must be a public accountant or a Federal, State, or local government audit organization that meets the general standards in Generally Accepted Government Auditing Standards.

(2) Completion and submission of a final Federal Financial Report (SF–425).

(3) Changes to the accounting system (e.g., the introduction and use of new accounting software).

(4) Grantee budget cycle.

C. Audit reports must only address the audit period unless there is an extraordinary finding.

(1) Extraordinary findings are those that involve fraud, direct and material illegal acts, or noncompliance that could result in exclusion from further participation in the program.

(2) Except for a fraud investigation, the Director must approve expanding the audit period to investigate extraordinary findings. Justification for requesting an expanded audit period must address the following elements:

(a) Criteria,

(b) Condition, and

(c) Effect (measure of consequences) of the finding.

(3) The Director may expand the audit period to include all unaudited Federal funds and license fee revenues.

D. Real and personal property is subject to audit regardless of the date of purchase.

1.8 Who maintains audit files, what is in them, and how long does the Service have to maintain them?

A. The Regional Director is responsible for maintaining audit files.

B. The following documents must be in the audit file:

(1) All audit-resolution correspondence, incoming and outgoing;

(2) Final audit reports;

(3) Any approved CAP for the audit;

(4) Documentation the grantee provides that the Regional Director uses to verify that the grantee resolved findings and implemented the auditor’s recommendation; and

(5) Documentation that the OIG or the Department closed the audit.

C. The documents must remain in the audit files until the OIG or Department closes the audit and the auditor completes the next audit. See 283 FW 1–4 for more information about retaining Government records.

1.9 What do the other Service Manual chapters in Part 417 cover? Table 1–4 summarizes the other chapters in this Part.

Table 1–4: Summary of Audit Chapters in Part 417
This chapter…	Describes…
417 FW 2: Planning	How the auditor, the Service, and the grantee: o Designate the points of contact, o Identify programmatic and financial elements to audit, o Discover issues of potential concern, o Set the audit schedule and milestones, and o Manage logistics.
417 FW 3: Fieldwork and Reporting	How the auditor: Conducts the audit, Issues a draft audit report, and Completes the final audit report.
417 FW 4: Resolution	How the Department and the Service track and resolve findings and recommendations from the audit reports.
417 FW 5: Appeals	The process where the grantee may challenge our: o Decisions, o Corrective actions, and o Resolutions in the CAP.
417 FW 6: Single Audit Act Audits	These are audits of a grantee required by the Single Audit Act of 1984, as amended (31 U.S.C. 7501 et seq.), and OMB Circular A–133 (Single Audits). Single Audits are different from the Service-administered audits of grantees. Chapter 417 FW 6 describes the policy for resolving findings from Single Audits.

For information on the content of this chapter, contact the Office of Wildlife and Sport Fish Restoration. For more information on this Web site, contact Krista Holloway in the Division of Policy and Directives Management.

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