Mass General Brigham Incorporated

Non-Compliance with Monthly Direct Loan Reconciliations Grantor: U.S. Department of Education Cluster: Student Financial Assistance Cluster Award Names: Federal Direct Loan Program Award Numbers: Not applicable Assistance Listing Number: 84.268 Award Year: 2023 – 2024 Criteria In accordance with 34 CFR 685.300(b)(5), on a monthly basis, institutions are required to reconcile institutional records with Direct Loan funds received from the Department of Education and Direct Loan disbursement records submitted to and accepted by the Department of Education. Condition The Company could not evidence that a monthly reconciliation was being performed between Direct Loan funds received from the Department of Education and Direct Loan disbursement records submitted to the Department of Education. Cause The Company indicated it performs a weekly reconciliation between funds received and funds disbursed to the Department of Education in order to determine the amount to return to or request from the Department. However, evidence of this reconciliation is not retained. Effect There is no evidence that the reconciliations were performed during the fiscal year. We could not observe evidence of this weekly reconciliation as part of audit procedures. Questioned Costs There are no questioned costs, as this is a documentation matter with no evidence of erroneous drawdowns and disbursements found in our testing. Recommendation We recommend that the Company update/enhance its procedures related to ensuring reconciliations are performed monthly and the audit evidence associated with the direct loan reconciliation and disbursements process is retained. Management’s Views and Corrective Action Plan Management’s Views and Corrective Action Plan are included at the end of this report after the summary schedule of prior audit findings and status.

Equipment Management Grantor: Various Cluster: Research & Development Award Names: Various Award Numbers: Various Assistance Listing Number: Various Award Year: Various Criteria 2 CFR 200.313 (d)(1-2) indicates that a physical inventory of federal equipment must be taken and the results reconciled with property records at least once every two years. Additionally, accurate property records must be maintained which include various identifying information, such as the location, use and condition of the property and any ultimate disposition data, including the date of disposal and sale of the property. Condition In testing the Company’s conformity with the compliance requirements for equipment management, we selected 25 pieces of equipment from the detailed listings provided to physically inspect. Additionally, in order to test the completeness of the detailed listings, we selected 25 pieces of equipment from the “floor” and traced these to the detailed listings provided. Through our testing, we noted the following: • Two pieces of equipment out of the 25 selections made from the detailed listings for physical inspection were incorrectly included in the listings. o One asset was moved to another institution with the associated principal investigator. The asset was not included in the list of equipment approved for the transfer with the departure of the principal investigator. The department continued to certify the asset was in service after the transfer of the asset. The acquisition price of the asset was $6,023.36. o The second asset was acquired in 2008 and sold in 2023, at the direction of the principal investigator, with the proceeds of the sale allocated to a non-federal internal research fund. The department continued to certify the asset was in service after the disposal of the asset. Cause For the first asset that was improperly included in the detailed listing, two pieces of the same equipment were purchased together, and one of the two pieces of equipment was retained, which caused the department to inadvertently certify that both assets were still in service. Further, the asset was not included on the list of equipment approved for transfer with the principal investigator’s departure from the Company. For the second asset, the principal investigator in charge of the equipment is in the process of leaving the Company, and the department is moving or disposing of his equipment. The equipment management team was waiting until the Investigator’s space was completely cleared before updating the inventory listings. Effect The process around the transfer and/or disposal of equipment when there is a transfer of an award, or a transfer of the principal investigator is not properly reflected in the Company’s inventory records. Questioned Costs There are no questioned costs. Under the Federal Grant and Cooperative Agreement Act, 31 U.S.C. 6306, NIH permits institutions to obtain title to equipment for support of basic or applied scientific research without further obligation to the Federal government. NIH has the right to require transfer of title to equipment with an acquisition cost of $5,000 or more to the Federal government within 120 of the completion of the award. The associated award ended prior to FY24, so the title transfer period has expired. Therefore, the equipment disposal did not result in questioned costs. Recommendation We recommend that the Company provide additional training to the principal investigators and other grant personnel focusing on the policies and procedures around federal equipment management. Specifically, the training should emphasize the importance of accuracy in the disposal request forms, including federal funding. The training should also focus on the importance of timely updates to the equipment inventory listing to ensure the listing is complete and accurate. Management’s Views and Corrective Action Plan Management’s Views and Corrective Action Plan are included at the end of this report after the summary schedule of prior audit findings and status.

Cash Management Grantor: Department of Health and Human Services Pass Through Entity: Advanced Regenerative Manufacturing Institute, Inc. Award Name: Hospital Preparedness Program (HPP) Ebola Preparedness and Response Activities Award Number: IDSEP22005-003 Assistance Listing Number: 93.817 Award Year: June 1, 2023-September 30, 2023 Criteria In accordance with 2 CFR 200.305 (b)(3), reimbursement is the preferred method when the requirements in paragraph (b) cannot be met, when the Federal awarding agency sets a specific condition per 2 CFR 200.208, or when the non-Federal entity requests payment by reimbursement. In accordance with 2 CFR 200.334 (c) and (e), a subrecipient must liquidate all financial obligations incurred under a subaward no later than 90 calendar days after the conclusion of the period of performance of the subaward (or an earlier date as agreed upon by the pass-through entity and subrecipient). The subrecipient must promptly refund any unobligated funds that the pass-through entity paid and that are not authorized to be retained. Condition In testing the period of performance compliance requirement in accordance with the OMB Compliance Supplement, we requested support for the expenditures on the FY2024 Schedule of Federal Awards, as they were outside of the period of performance of the subaward, which ended September 30, 2023. The Company issued an invoice to Advanced Regenerative Manufacturing Institute, the Prime awardee, for $215,192 on September 14, 2023, but did not incur those expenses until after the period of performance of the subaward. Therefore, the Company requested and received the funds in advance of incurring the expenses. Further, the Company did not liquidate its obligations under the subaward within the required 90 calendar days after the conclusion of the performance of the subaward, as expenditures were recorded through August 2024. There were no terms in the award that allowed retention of unused funds. Cause The grant personnel were not aware of the invoicing requirements under the reimbursement method and invoiced the Prime awardee in advance of incurring the associated costs. Effect Federal funds were obtained in advance of incurring costs and outside of the period of performance of the subaward. Questioned Costs $215,192 Recommendation We recommend that the Company return the advance funds received to the Prime. Further, the Company should consider the need for clarifying and/or enhancing existing internal control procedures to ensure expenditures are paid in compliance with Federal reimbursement requirements and that requests for reimbursement are reviewed and validated against supporting documentation to identify any discrepancies prior to requesting reimbursement. Management’s Views and Corrective Action Plan Management’s Views and Corrective Action Plan are included at the end of this report after the summary schedule of prior audit findings and status.

2019-001 Equipment Research and Development Cluster Grantor: Department of Health and Human Services National Institute of Health Program Name: Refer to table below Award Year: 2019 Award Number: Refer to table below CFDA Number: Refer to table below Criteria Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the FAIN), who holds title, the acquisition date, and cost of the property, the percentage of Federal participation in the project costs for the Federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sale price of the property. (2 CFR section 200.313(d). Condition Based on guidance provided by the Department of Health and Human Services (HHS), Partners HealthCare currently utilizes a statistical sampling methodology for their physical equipment observations at certain facilities as part of their internal control related to the Research and Development cluster. Partners HealthCare performed an equipment observation for 418 property records throughout fiscal year 2019 at certain facilitates, noting no exceptions identified (0%). However, as part of the PwC Research and Development cluster equipment testing of safeguarding and retention of property records, 6 out of 56 (10%) equipment selections were identified as disposed but were not identified as such in the property records and documentation was not retained supporting these dispositions. The assets identified including their book and net value as follows: See Schedule of Findings and Questioned Costs for chart/table. Cause Individuals who disposed of assets did not follow Partners HealthCare?s policies with respect to disposal of assets purchased with federal funds. Additionally, Partners HealthCare performed a statistical sampling methodology each year at certain facilities, however there was no periodic full inventory count performed or review of full depreciated assets to ensure these assets purchased with federal funding were still in use or disposed of based upon Partners HealthCare policies to ensure the proper documentation was retained. Effect Assets were inappropriately included in the listing of federal equipment which were no longer in use that had been disposed of without the proper documentation being retained. Recommendation We recommend Partners HealthCare consider performing a complete inventory count periodically including follow up and education sessions with Principal Investigators and other research staff responsible for the safeguarding and disposal of any equipment that was marked as in use to ensure the asset has not been disposed of based upon Partners HealthCare?s policies. Additionally, we recommend Partners Healthcare perform a review of fully depreciated assets on a periodic basis to ensure property records and documentation properly reflect equipment which has been disposed or transferred. Management?s Views and Corrective Action Plan Management?s views and corrective action plan is included at the end of this report after the summary schedule of prior audit findings.

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