NORTHWEST INDIAN COLLEGETribal Government

Federal Agency: Department of the Interior, National Science Foundation, Department of Health and Human Services, and Department of Education Federal Programs: Assistance to Tribally Controlled Community Colleges and Universities, Research and Development Cluster and COVID-19 – Education Stabilization Fund Assistance Listing Numbers: 15.027, 47.076 and 93.859, and 84.425K and 84.425F Federal Award Identification Number and Year: Various Award Period: July 1, 2021 to June 30, 2022 Type of Finding: Material Weakness in Internal Control over Compliance and Other Matters Criteria: In accordance with 2 CFR 200.303, the College must establish and maintain effective internal controls over federal awards that provide reasonable assurance that the College is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Additionally, non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. "Covered transactions" include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a passthrough entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. Condition: 10 out of the 11 vendors tested had no documentation to ensure the vendor was not suspended or debarred at the time of purchase. At least one vendor was tested from each program. Upon Inquiry, we noted the College does not have a suspension and debarment policy or process. Questioned Costs: None. Context: The College entered into transactions with vendors before verifying they were not suspended or debarred. Cause: There is no control system in place to ensure there are no transactions entered into with suspended or debarred vendors. Effect: The College could have entered into transactions with suspended or debarred vendors. Repeat Finding: Yes, see Finding 2021-003. Recommendation: We recommend the College implement a suspension and debarment policy and corresponding procedures. Views of Responsible Officials: Management agrees with the finding and has prepared a plan to correct the finding.

Federal Agency: Department of the Interior Federal Programs: Assistance to Tribally Controlled Community Colleges and Universities Assistance Listing Numbers: 15.027 Federal Award Identification Number and Year: A19AP00118-09 Award Period: July 1, 2021 to June 30, 2022 Type of Finding: Material Weakness in Internal Control over Compliance and Other Matters Criteria: In accordance with 2 CFR 200.303, the College must establish and maintain effective internal controls over federal awards that provide reasonable assurance that the College is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Additionally, 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 federal award identification number), who holds title, the acquisition date, cost of the property, 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 sales price of the property (2 CFR section 200.313(d)(1)). Further 200.313(d)(2) states that the property records must be reconciled with a physical inventory count at least once every two years. Condition: The College did not have documentation of physical inventory of the equipment purchased with Federal Funds. The College did not adequately track equipment funded with federal awards and their respective disposals. Further the College did not maintain the required information as part of their property and equipment records. Questioned Costs: None Context: During our testing of property and equipment purchases it was noted the property records for the equipment purchased did not contain the required information for all 11 equipment purchases we selected for testing. In addition, there was no documentation that showed a physical inventory was taken over this equipment at least every two years. Cause: The College did not have an effective control in place to ensure that the required information for equipment purchased with federal funds was maintained and that a physical inventory count was completed every two years. Effect: The College did not meet equipment property record requirements for equipment purchased with federal funds. Repeat Finding: Yes, see Finding 2021-004. Recommendation: We recommend the College implement policies and procedures to ensure all property and equipment purchased with federal funds includes such information in the property records to comply with the requirement, and physical inventory be taken at least every two years. Views of Responsible Officials: Management agrees with the finding and has prepared a plan to correct the finding.

Federal Agency: Department of the Interior and Department of Education Federal Programs: Assistance to Tribally Controlled Community Colleges and Universities and COVID-19 – Education Stabilization Fund Assistance Listing Numbers: 15.027 and 84.425K Federal Award Identification Number and Year: A19AP00118-09 and P425K00022 Award Period: July 1, 2021 to June 30, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance and Other Matters Criteria: The Uniform Guidance Cost Principles described in 2 CFR Part 200, Compensation, states that costs of compensation are allowable to the extent that they satisfy the specific requirements of the grant and that total compensation for individual employees is reasonable for the services rendered. Salaries and benefits are allowable for this grant as long as the job duties are a result of responding to the pandemic. In addition, 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Condition: During our testing, we noted the following matters related to allowable costs and activities. Assistance Listing Number 15.027: • Of the 14 payroll disbursements selected for testing, it was noted that 6 employees were underpaid and 5 were overpaid based on the information available. Assistance Listing Number 84.425K: • Of the 60 payroll disbursements selected for testing, it was noted that one employee was overpaid based on the information available. Questioned Costs: Assistance Listing Number 15.027 - $6,649. Context: During our testing of payroll expenditures, the College was unable to provide support for payroll costs charged to the grant. Total payroll costs charged to assistance listing numbers 15.027 was $3,920,538. Total payroll costs charged to assistance listing number 84.425K and 84.425F were $836,137.78. Cause: Due to staffing shortages, as well as the amount of time passed from the transactions being tested, the College was unable to provide support for payroll costs. Effect: The College is unable to support payment amounts to 12 employees. Repeat Finding: Yes, see Finding 2021-005 Recommendation: We recommend the College enhance their controls around payroll disbursements to ensure employees are paid properly. Views of Responsible Officials: Management agrees with the finding and has prepared a plan to correct the finding.

Federal Agency: Department of the Interior Federal Programs: Assistance to Tribally Controlled Community Colleges and Universities Assistance Listing Numbers: 15.027 Federal Award Identification Number and Year: A19AP00118-09 Award Period: July 1, 2021 to June 30, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance and Other Matters Criteria: In accordance with 2 CFR 200.317 through 200.326 there are procurement standards within the Uniform Guidance. These standards include elements that should be followed pre-contract. Specifically, UG §200.318 states that the non-Federal entity must maintain records sufficient to detail the history of procurement. These records will include but are not necessarily limited to the following: Rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price. Condition: The College did not have proper documentation to support one procurement transaction. Questioned Costs: None. Context: During our testing of 8 procurement transactions, it was noted the College did not retain proper documentation related to 1 procurement transaction. Cause: The College did not retain proper documentation of one procurement transaction. Effect: The College was not in compliance with procurement regulations. Repeat Finding: No. Recommendation: We recommend the College implement policies and procedures to ensure all procurement documentation is complete and retained. Views of Responsible Officials: Management agrees with the finding and has prepared a plan to correct the finding.

Federal Agency: Department of Education Federal Programs: COVID-19 – Education Stabilization Fund Assistance Listing Numbers: 84.425E Federal Award Identification Number and Year: P425E200449 Award Period: July 1, 2021 to June 30, 2022 Type of Finding: Material Weakness in Internal Control over Compliance Criteria: In accordance with 2 CFR 200.303, the College must establish and maintain effective internal controls over federal awards that provide reasonable assurance that the College is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: The College did not have observable controls to test to ensure the students receiving HEERF funding were eligible. Questioned Costs: None. Context: During the testing of student disbursements, we were unable to test a specific control in place to ensure any error in a student’s disbursement would be prevented and detected in a timely manner. Cause: The College did not have an observable control in place to ensure students were eligible for the HEERF funding they received. Effect: It is possible that a student could receive funding when they are not eligible for. Repeat Finding: No. Recommendation: We recommend the College retain evidence of the review of student accounts prior to disbursement of HEERF funds. Views of Responsible Officials: Management agrees with the finding and has prepared a plan to correct the finding.

Federal Agency: Department of Education Federal Programs: COVID-19 – Education Stabilization Fund Assistance Listing Numbers: 84.425E, 84.425F, 84.425K Federal Award Identification Number and Year: P425E200449, P425F204781, P425K200022 Award Period: July 1, 2021 to June 30, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance and Other Matters Criteria: The Code of Federal Regulations, 2 CFR 200.303, non-Federal entities receiving Federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations and program compliance requirements. There are three components to reporting for Higher Education Emergency Relief Funds (HEERF): 1) public reporting on the (a)(1) Student Aid Portion; 2) public reporting on the (a)(1) Institutional Portion (a)(2) and (a)(3) subprograms (Quarterly Reporting Form), as applicable; and 3) the annual report. The CARES Act 18004(e) and the CRRSAA 314(e) requires an institution receiving funds under HEERF I and HEERF II to submit a report to the secretary, at such time in such a manner as the secretary may require. While ARP does not explicitly identify procedures by which institutions must report on their uses of HEERF grant funds, the Department of Education exercises this reporting authority under 2 CFR section 200.328 and 2 CFR section 200.329. Condition: The College is not in compliance with Quarterly and Annual reporting requirements for HEERF. Questioned Costs: None. Context: Out of 2 Quarterly Institutional and 2 Quarterly Student reports tested all 4 reports were not submitted timely. In addition, the annual report was not submitted timely. Cause: The College did not have appropriate controls in place to ensure reports were completed and published to the institution’s website in a timely manner. Effect: The institution is not meeting the reporting and information-sharing requirements determined by the Department of Education. As a result, the institution may be subject to additional enforcement actions by the Department of Education including a delay in funding for additional HEERF programs and possibly being determined ineligible for other program funding. Repeat Finding: No. Recommendation: We recommend the College review the reporting requirements and implement procedures to ensure that all required reports are issued/posted in an accurate and timely manner. Views of Responsible Officials: Management agrees with the finding and has prepared a plan to correct the finding.

Federal Agency: Department of Health and Human Services Federal Programs: Research and Development Cluster Assistance Listing Numbers: 93.859 Federal Award Identification Number and Year: 1S06GM123552-01 Award Period: July 1, 2021 to June 30, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance and Other Matters Criteria: The Federal Government requires that when the reimbursement method is used, the Federal awarding agency or pass-through entity must make payment within 30 calendar days after receipt of the billing, unless the Federal awarding agency or pass-through entity reasonably believes the request to be improper (2 CFR section 200.305(b)(3)). Per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Condition: The College did not make payments to subrecipients within 30 days after receipt of invoices. Questioned Costs: None. Context: During our testing of 7 out of 27 subrecipient payments during the year. CLA notes that 1 of the 7 payments was not made to the subrecipient within 30 calendar days as required. Cause: The College did not have an effective control in place to ensure subrecipient payments were paid timely. Effect: The College was not in compliance with the regulation to make payments to subrecipients within the required timeframe. Repeat Finding: No. Recommendation: We recommend that the College review and update current procedures to ensure subrecipient payments are paid timely. Views of Responsible Officials: Management agrees with the finding and has prepared a plan to correct the finding.

Criteria: In accordance with 2 CFR 200.303, the College must establish and maintain effective internal controls over federal awards that provide reasonable assurance that the College is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Additionally, non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. "Covered transactions" include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a passthrough entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. Condition: During our testing, three out of the four vendors selected for testing did not have documentation to ensure the vendor was not suspended or debarred at the time the transaction was entered into. Additionally, we noted the College currently does not have a suspension and debarment policy or process in place. Questioned Costs: None. Context: The College entered into transactions with vendors before verifying they were not suspended or debarred. Cause: There is no control system in place to ensure there are no transactions entered into with suspended or debarred vendors. Effect: The College could have entered into transactions with suspended or debarred vendors. Repeat Finding: Yes, see finding 2020-003. Recommendation: We recommend the College implement a suspension and debarment policy and corresponding procedures. Views of responsible officials: Management agrees with the finding and has prepared a plan to correct the finding.

Criteria: In accordance with 2 CFR 200.303, the College must establish and maintain effective internal controls over federal awards that provide reasonable assurance that the College is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Additionally, 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 federal award identification number), who holds title, the acquisition date, cost of the property, 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 sales price of the property (2 CFR section 200.313(d)(1)). Condition: The College did not have the percentage of federal participation in the project costs for the federal award under which the property was acquired in the property records. Questioned Costs: None. Context: During our testing of property and equipment purchases, it was noted that the modular building purchased with federal funds did not have the percentage of federal participation included in the property records. For the year ended June 30, 2021, costs for the purchase of the modular building were $227,056, all of which were from federal funds. Additionally, the property had not been tagged as having been purchased with federal funds. Cause: The College did not have the percentage of federal participation as part of their property and equipment records. Effect: The College did not meet equipment property record requirements for equipment purchased with federal funds. Repeat Finding: No Recommendation: We recommend the College implement policies and procedures to ensure all property and equipment purchased with federal funds includes such information in the property records to comply with the requirement. Views of responsible officials: Management agrees with the finding and has prepared a plan to correct the finding.

Criteria: The Uniform Guidance Cost Principles described in 2 CFR Part 200, Compensation, states that costs of compensation are allowable to the extent that they satisfy the specific requirements of the grant and that total compensation for individual employees is reasonable for the services rendered. Salaries and benefits are allowable for this grant as long as the job duties are a result of responding to the pandemic. In addition, 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Condition: During our testing, we noted the following matters related to allowable costs and activities. Assistance Listing Number 15.027: • Of the fourteen payroll disbursements selected for testing, it was noted that three employees were underpaid and five were overpaid based on the information available. Assistance Listing Number 47.076 and 93.859: • Of the forty payroll disbursements selected for testing, it was noted that one employee was underpaid and another disbursement where the same employee was overpaid. As a result, the amount charged to the grant was correct based on the amount the employee was ultimately paid, however the payments themselves were not correct. Assistance Listing Number 84.425K: • Of the twenty payroll disbursements selected for testing, it was noted that one employee was underpaid. Questioned Costs: Assistance Listing Number 15.027 - $4,007. Context: During our testing of payroll expenditures, the College was unable to provide support for payroll costs charged to the grants. Total payroll costs charged to assistance listing numbers 15.027, 47.076/93.859 and 84.425 were $4,337,717, $763,833 and $251,977, respectively. Cause: Due to staffing shortages, as well as the amount of time passed from the transactions being tested, the College was unable to provide support for payroll costs. Effect: The College is unable to support payment amounts to eleven employees. Repeat Finding: No Recommendation: We recommend the College enhance their controls around payroll disbursements to ensure employees are paid properly. Views of responsible officials: Management agrees with the finding and has prepared a plan to correct the finding.

Program Information: U.S. Department of the Interior AL Number Award Number Award Period Grant Name 15.027 A19AP00118 07/01/2019-09/30/2020 Assistance to Tribally Controlled Community Colleges and universities Criteria: Audit Requirements: Pursuant to 2 C.F.R. ? 200, Subpart F ? Audit Requirements, if the Recipient expends $750,000 or more during the Recipient's fiscal year in Federal awards, the Recipient must have a single or program-specific audit conducted for the year in accordance with Subpart F. Subpart F, 2 CFR ?200.512(a)(1) states: ?The audit must be completed and the data collection form described in paragraph (b) of this section and reporting package described in paragraph (c) of this section must be submitted within the earlier of 30 calendar days after receipt of the auditor's report(s), or nine months after the end of the audit period. If the due date falls on a Saturday, Sunday, or Federal holiday, the reporting package is due the next business day.? Condition/Context: Because of COVID-19, the OMB extended the College?s March 30, 2021, submission deadline for six months, however, the annual single audit, and data collection form were not completed and submitted in the required timeframe. [ X ] Compliance Finding [ ] Significant Deficiency [ X ] Material Weakness Cause: The College did not follow its policies and procedures. Effect: The College could be at risk of sanctions from funding agencies or loss of funding. Questioned Costs: None. Repeat Finding: Yes, 2019-004 Recommendation: We recommend that the College establish a process and follow policies and procedures to ensure its annual single audit is submitted on or before the required deadline. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding and has prepared corrective action as detailed in its Corrective Action Plan.

Program Information: U.S. Department of the Interior AL Number Award Number Award Period Grant Name 15.027 A19AP00118 07/01/2019-09/30/2020 Assistance to Tribally Controlled Community Colleges and universities Criteria: Procurement?Grants and Cooperative Agreements Non-Federal entities other than States, including those operating Federal programs as subrecipients of States, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable State and local laws and regulations, provided that the procurements conform to applicable Federal statutes and the procurement requirements identified in 2 CFR part 200. A non-Federal entity must: 1. Meet the general procurement standards in 2 CFR section 200.318, which include oversight of contractors? performance, maintaining written standards of conduct for employees involved in contracting, awarding contracts only to responsible contractors, and maintaining records to document history of procurement. Suspension and Debarment Non-Federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. ?Covered transactions? include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a passthrough entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. When a non-Federal entity enters into a covered transaction with an entity at a lower tier, the non-Federal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. This verification may be accomplished by (1) checking the Excluded Parties List System (EPLS) maintained by the General Services Administration (GSA) and available at https://www.sam.gov/SAM/, (2) collecting a certification from the entity, or (3) adding a clause or condition to the covered transaction with that entity (2 CFR section 180.300). Condition/Context: During a review of the College?s procurement policy, it was noted that it has not been updated to meet Uniform Guidance requirements. Additionally, during review of client files, it was noted that the College was not verifying that vendors were not suspended or disbarred before entering into contract for one out of one vendor tested. [ X ] Compliance Finding [ ] Significant Deficiency [ X ] Material Weakness Cause: The College did not update its procurement policy to comply with Uniform Guidance. Additionally, the College did not verify a vendor was not suspended or disbarred before entering into contract. Effect: The College may not be in compliance with procurement standards and could procure goods unknowingly out of compliance. Additionally, without verifying whether vendors are suspended or debarred from working on federally-funded projects, the College could be contracting with vendors that are prohibited from working on federally-funded projects. Questioned Costs: None. Repeat Finding: Yes, 2019-002 Recommendation: We recommend the College update its procurement policy to comply with Uniform Guidance. Additionally, we recommend that the College follow proper internal control procedures to verify vendors against SAM.gov in order to ensure vendors are not suspended or debarred from federally-funded purchases. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding and has prepared corrective action as detailed in its Corrective Action Plan.

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