--------------------- ------------------------------- ---------- ----------------------
  **Guide for Review of                                            
  HBCU Financial                                                   
  Management**                                                     

  **Name of Program                                                
  Participant:     **                                              

  **Staff                                                          
  Consulted:     **                                                

  **Name(s) of                                          **Date**        
  Reviewer(s)**                                                    
  --------------------- ------------------------------- ---------- ----------------------

**NOTE:** All questions that address requirements contain the citation
for the source of the requirement (statute, regulation, NOFA, or grant
agreement). Except for questions 25 and 45, if the requirement is not
met, HUD must make a finding of noncompliance. All other questions
(questions that do not contain the citation for the requirement) do not
address requirements, but are included to assist the reviewer in
understanding the participant\'s program more fully and/or to identify
issues that, if not properly addressed, could result in deficient
performance. Negative conclusions to these questions may result in a
\"concern\" being raised, but not a **\"finding.**\"

**[Instructions]{.underline}:** This Exhibit is to be used to monitor
the HBCU's conformity to financial management requirements. The Exhibit
is divided into 10 sections covering: Financial Management; Advances;
the SF-272, Federal Cash Transactions Report; Internal Controls;
Accuracy of Report Information; Program Income; Salaries and Wages;
Indirect Costs; Minority-Owned Financial Institutions; and OMB Circular
A-133. The HBCU's financial management system is to be reviewed for
compliance with 24 CFR Part 84, Subpart C, Post Award Requirements, and
Subpart D, After the Award Requirements.

**[Questions:]{.underline}**

[A. Financial Management System]{.underline}

1\.

+------------------------------------------------------------+---------+
| Does the HBCU record amounts budgeted for eligible         |         |
| activities as specified in the Grant Agreement being       |         |
| monitored?                                                 |         |
|                                                            |         |
| \[HBCU Grant Agreement, Section 11, Budget, and Section 2, |         |
| Applicable Program Requirements; 24 CFR 84.21\]            |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

2\.

+------------------------------------------------------------+---------+
| a\. Does the HBCU record an encumbrance when contracts are |         |
| executed, purchase orders issued, etc.? **NOTE:** If       |         |
| encumbrances are not recorded, the program participant     |         |
| should maintain information on obligations that is readily |         |
| accessible.                                                |         |
|                                                            |         |
| \[HBCU Grant Agreement, Section 11, Budget, and Section 2, |         |
| Applicable Program Requirements; 24 CFR 84.21(b)(2)\]      |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

+------------------------------------------------------------+---------+
| > b\. For the selected sample reviewed, are expenditures   |         |
| > supported by invoices, contracts, or purchase orders,    |         |
| > etc.?                                                    |         |
|                                                            |         |
| \[24 CFR 84.21(b)(7)\]                                     |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

3\.

+------------------------------------------------------------+---------+
| If the accounting system is on a cash basis, can the HBCU  |         |
| support accrual data in the other quarterly or semi-annual |         |
| performance report(s) from documentation on hand?          |         |
|                                                            |         |
| \[24 CFR 84.21(b)(1)\]                                     |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

4\.

+----------------------------------------------------------+-----------+
| If the accounting system provides for accrual of         |           |
| expenditures, does the information reported to HUD       |           |
| reconcile with accounting records?                       |           |
|                                                          |           |
| \[HBCU Grant Agreement, Section 6, Tasks 3.a. and 3.b,   |           |
| Reporting Requirements; 24 CFR 84.21(b)(1)\]             |           |
+----------------------------------------------------------+-----------+
| **Describe Basis for Conclusion:**                       |           |
+----------------------------------------------------------+-----------+
|                                                          |           |
+----------------------------------------------------------+-----------+

5\.

+------------------------------------------------------------+---------+
| Does the HBCU identify expenditures with respect to the    |         |
| grant program?                                             |         |
|                                                            |         |
| \[24 CFR 84.21(b)(2)\]                                     |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

6\.

+------------------------------------------------------------+---------+
| Does the HBCU identify expenditures by specific grant?     |         |
|                                                            |         |
| \[HBCU Grant Agreement; 24 CFR 84.21(b)(2)\]               |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

7\.

+------------------------------------------------------------+---------+
| a\. Does the HBCU identify expenditures in its accounting  |         |
| records according to eligible activity classifications     |         |
| that clearly identify the use of program funds for         |         |
| eligible activities?                                       |         |
|                                                            |         |
| > \[HBCU Grant Agreement, Section 6, Scope of Work, and    |         |
| > Section 11, Budget; 24 CFR 84.21(b)(2)\]                 |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

+------------------------------------------------------------+---------+
| b\. Did the record review indicate that expenditures were  |         |
| eligible?                                                  |         |
|                                                            |         |
| \[HBCU Grant Agreement, Section 9, Eligible Activities,    |         |
| and Section 5, Incurrence of Costs\]                       |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

8\.

+------------------------------------------------------------+---------+
| Do accounting records include unexpended/unobligated       |         |
| balances?                                                  |         |
|                                                            |         |
| \[24 CFR 84.21(b)(2)\]                                     |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

[B. Advances]{.underline}

9\.

+----------------------------------------------------------+-----------+
| If the HBCU requests funds in advance (and is not on a   |           |
| reimbursement basis), does it minimize the time elapsed  |           |
| between the transfer of funds from the U.S. Treasury and |           |
| disbursement by the HBCU?                                |           |
|                                                          |           |
| \[HBCU Grant Agreement, Section 13, Method of Payment;   |           |
| 24 CFR 84.22\]                                           |           |
+----------------------------------------------------------+-----------+
| **Describe Basis for Conclusion:**                       |           |
+----------------------------------------------------------+-----------+
|                                                          |           |
+----------------------------------------------------------+-----------+

10\.

+----------------------------------------------------------+-----------+
| If the HBCU [advances grant funds to                     |           |
| subrecipients]{.underline}, does it minimize the time    |           |
| elapsed between the transfer of funds to, and            |           |
| disbursement by, the subrecipients?                      |           |
|                                                          |           |
| \[HBCU Grant Agreement, Section 13, Method of Payment,   |           |
| and Section 17, Flow Down Procedures; 24 CFR 84.22\]     |           |
+----------------------------------------------------------+-----------+
| **Describe Basis for Conclusion:**                       |           |
|                                                          |           |
|                                                          |           |
+----------------------------------------------------------+-----------+

[c. SF-269A, Financial status report]{.underline}

11\.

+------------------------------------------------------------+---------+
| For the SF-269A, Financial Status Report, has the HBCU     |         |
| submitted this timely and complete report for the last 3   |         |
| reporting periods? ?                                       |         |
|                                                            |         |
| \[HBCU Grant Agreement, Section 6, Task 3, Reporting       |         |
| Requirements; 24 CFR 84.52(a)(2)\]                         |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

12\.

+----------------------------------------------------------+-----------+
| If grant advances are deposited into an interest-bearing |           |
| account, what provisions have been made for return of    |           |
| interest income to HUD?                                  |           |
|                                                          |           |
| \[24 CFR 84.22(c)(2) and (3); 24 CFR 84.22(d)\]          |           |
+----------------------------------------------------------+-----------+
| **Describe Basis for Conclusion:**                       |           |
+----------------------------------------------------------+-----------+
|                                                          |           |
+----------------------------------------------------------+-----------+

[d. Internal Controls]{.underline} (Reference for some of the questions:
GAO/AIMD-98-21.2.1, "Framework for Federal Financial Management System
Checklist," May 1998)

13\.

  ------------------------------------------------------------- ---------
  a\. Does the HBCU have an organization chart that sets forth  
  the actual lines of responsibility?                           

  **Describe Basis for Conclusion:**                            

                                                                
  ------------------------------------------------------------- ---------

  ------------------------------------------------------------- ---------
  b\. Are duties for key employees of the HBCU defined?         

  **Describe Basis for Conclusion:**                            

                                                                
  ------------------------------------------------------------- ---------

  ------------------------------------------------------------- ---------
  c\. Has the HBCU obtained fidelity bond coverage for          
  responsible officials?                                        

  **Describe Basis for Conclusion:**                            

                                                                
  ------------------------------------------------------------- ---------

  ------------------------------------------------------------- ---------
  d\. Does the HBCU's chart of accounts include a complete      
  listing of the account numbers used to support the control    
  needed to ensure that resources used do not exceed resources  
  authorized?                                                   

  **Describe Basis for Conclusion:**                            

                                                                
  ------------------------------------------------------------- ---------

  ------------------------------------------------------------- ---------
  e\. Does the HBCU's approval controls provide reasonable      
  assurance that appropriate individuals approve recorded       
  transactions in accordance with management's general or       
  specific criteria?                                            

  **Describe Basis for Conclusion:**                            

                                                                
  ------------------------------------------------------------- ---------

+------------------------------------------------------------+---------+
| f\. Does the HBCU's controls over the design and use of    |         |
| documents and records provide reasonable assurance that    |         |
| transactions and events are properly documented, recorded, |         |
| and auditable?                                             |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
|                                                            |         |
| **     **                                                  |         |
+------------------------------------------------------------+---------+

  ------------------------------------------------------------- ---------
  g\. Does the HBCU's segregation of duties controls            
  effectively reduce the opportunity for someone to perpetrate  
  or conceal errors or irregularities in the normal course of   
  duties?                                                       

  **Describe Basis for Conclusion:**                            

                                                                
  ------------------------------------------------------------- ---------

  ------------------------------------------------------------- ---------
  h\. Is it clear that all personnel are responsible for        
  communicating upward the program participant's operating      
  problems and noncompliance with laws and regulations?         

  **Describe Basis for Conclusion:**                            

                                                                
  ------------------------------------------------------------- ---------

  ------------------------------------------------------------- ---------
  i\. Does the HBCU's internal control procedures support its   
  ability to prepare financial statements that are fairly       
  presented in conformity with generally accepted or other      
  relevant and appropriate accounting principles and regulatory 
  requirements? (One level of assurance of the accuracy and     
  integrity of data is provided by the attainment of an         
  unqualified opinion on the audited annual financial           
  statements and internal controls.)                            

  **Describe Basis for Conclusion:**                            

                                                                
  ------------------------------------------------------------- ---------

[e. Accuracy of Report Information]{.underline}

14\.

  -----------------------------------------------------------------------
  a\. How does the HBCU demonstrate that its systems and/or procedures
  ensure that accurate information is collected and reported to HUD and
  that such systems and/or procedures comply with Federal policies and
  requirements governing reporting?

  **Describe Basis for Conclusion:**

       
  -----------------------------------------------------------------------

+------------------------------------------------------------+---------+
| b.  Does the financial information (e.g., drawdowns,       |         |
|     unexpended balances) recorded in HUD's financial       |         |
|     management systems (e.g., Line of Credit Control       |         |
|     System, or LOCCS) match the official accounting        |         |
|     records of the HBCU for the period covered by the last |         |
|     required performance report?                           |         |
|                                                            |         |
|     \[HBCU Grant Agreement, Section 6, Task 3.b, Financial |         |
|     Reporting Requirements; 24 CFR 84.21(a)(1)\]           |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

+------------------------------------------------------------+---------+
| c.  Does the program income information in the HBCU's      |         |
|     official accounting records for the period covered by  |         |
|     the most recently completed performance report match   |         |
|     the performance report information?                    |         |
|                                                            |         |
|     \[HBCU Grant Agreement, Section 29; 24 CFR Part        |         |
|     84.24\]                                                |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

[f. Program Income]{.underline}

15\.

  ------------------------------------------------------------- ---------
  Are revenue-generating activities (e.g., rehabilitation,      
  economic development loans) being undertaken?                 

  **Describe Basis for Conclusion:**                            

                                                                
  ------------------------------------------------------------- ---------

16\.

+----------------------------------------------------------+-----------+
| If revenue-generating activities are being undertaken,   |           |
| has the HBCU established revenue accounts to record      |           |
| program income?                                          |           |
|                                                          |           |
| \[HBCU Grant Agreement, Section 29, Program Income; 24   |           |
| CFR 84.21(b)(2)\]                                        |           |
+----------------------------------------------------------+-----------+
| **Describe Basis for Conclusion:**                       |           |
+----------------------------------------------------------+-----------+
|                                                          |           |
+----------------------------------------------------------+-----------+

17\.

+----------------------------------------------------------+-----------+
| If the HBCU has an activity generating program income    |           |
| that is only partially Federally assisted, does it have  |           |
| a system for ensuring that the program income is         |           |
| properly prorated to reflect the percentage of Federal   |           |
| program funds used?                                      |           |
|                                                          |           |
| \[HBCU Grant Agreement, Section 29; 24 CFR 84.24\]       |           |
+----------------------------------------------------------+-----------+
| **Describe Basis for Conclusion:**                       |           |
+----------------------------------------------------------+-----------+
|                                                          |           |
+----------------------------------------------------------+-----------+

18\.

+----------------------------------------------------------+-----------+
| If the HBCU earns program income, has it disbursed it    |           |
| (other than program income deposited in a revolving      |           |
| funds) in payment of program costs prior to making       |           |
| further cash withdrawals from the U.S. Treasury?         |           |
|                                                          |           |
| \[HBCU Grant Agreement, Section 29; 24 CFR 84.22(g)\]    |           |
+----------------------------------------------------------+-----------+
| **Describe Basis for Conclusion:**                       |           |
+----------------------------------------------------------+-----------+
|                                                          |           |
+----------------------------------------------------------+-----------+

19\.

+----------------------------------------------------------+-----------+
| a\. If the HBCU passes funds through to subrecipients or |           |
| other entities, does the HBCU have a system for tracking |           |
| program income generated by these subrecipients or other |           |
| entities?                                                |           |
|                                                          |           |
| \[HBCU Grant Agreement, Section 17; 24 CFR 84.24\]       |           |
+----------------------------------------------------------+-----------+
| **Describe Basis for Conclusion**                        |           |
+----------------------------------------------------------+-----------+
|                                                          |           |
+----------------------------------------------------------+-----------+

+----------------------------------------------------------+-----------+
| b.  If program income is retained by subrecipients or    |           |
|     pass-through entities, does the HBCU have a system   |           |
|     for ensuring that such income is reported in a       |           |
|     timely and accurate manner?                          |           |
|                                                          |           |
|     \[HBCU Grant Agreement, Section 17, Flow Down        |           |
|     Provisions\]                                         |           |
+----------------------------------------------------------+-----------+
| **Describe Basis for Conclusion:**                       |           |
+----------------------------------------------------------+-----------+
|                                                          |           |
+----------------------------------------------------------+-----------+

+------------------------------------------------------------+---------+
| c\. Upon expiration of any agreements between the HBCU and |         |
| its subrecipients and/or pass-through entities, does the   |         |
| HBCU have a system for ensuring:                           |         |
|                                                            |         |
| i.  the timely and accurate transfer of any funds to be    |         |
|     returned to the HBCU; and/or                           |         |
|                                                            |         |
| ii. the time and accurate transfer of outstanding loans or |         |
|     accounts receivable?                                   |         |
|                                                            |         |
|     \[HBCU Grant Agreement, Section 17, Flow Down          |         |
|     Provisions\]                                           |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

20\.

+----------------------------------------------------------+-----------+
| If the HBCU received unexpected amounts of program       |           |
| income during its program year, did it follow the        |           |
| required procedures for amending or revising its grant   |           |
| agreement?                                               |           |
|                                                          |           |
| \[HBCU Grant Agreement, Section 16, Amendments\]         |           |
+----------------------------------------------------------+-----------+
| **Describe Basis for Conclusion:**                       |           |
+----------------------------------------------------------+-----------+
|                                                          |           |
+----------------------------------------------------------+-----------+

21\. Loan Servicing

+----------------------------------------------------------+-----------+
| If the HBCU provides loans, does it have a system for    |           |
| properly servicing all loans (including deferred payment |           |
| loans and revolving loan funds) that includes:           |           |
|                                                          |           |
| i\. written loan agreements that clearly describe the    |           |
| repayment terms, what constitutes a default and how it   |           |
| can be cured, and what actions the HBCU will take if the |           |
| default is not cured, and (if applicable) what is        |           |
| pledged as security for the loan?                        |           |
|                                                          |           |
| iii. collection procedures that provide for the          |           |
|      recognition of all current amounts due, payments    |           |
|      received, notification to borrower when payments    |           |
|      are overdue, a process for taking further action on |           |
|      defaulted loans, and criteria for writing off bad   |           |
|      debts?                                              |           |
|                                                          |           |
|      \[HBCU Grant Agreement, Section 17, Flow Down       |           |
|      Provisions; 24 CFR 84.2(b)(5)\]                     |           |
+----------------------------------------------------------+-----------+
| **Describe Basis for Conclusion:**                       |           |
+----------------------------------------------------------+-----------+
|                                                          |           |
+----------------------------------------------------------+-----------+

[G. Salaries and Wages]{.underline}

22\.

+----------------------------------------------------------+-----------+
| Are direct salaries and wages of employees chargeable    |           |
| only to the HBCU program or cost objective based on      |           |
| payrolls documented in accordance with the generally     |           |
| accepted practice of the HBCU and approved by a          |           |
| responsible official?                                    |           |
|                                                          |           |
| \[HBCU Grant Agreement, Section 1, Allowable Costs; OMB  |           |
| Circular A-21, J.10\]                                    |           |
+----------------------------------------------------------+-----------+
| **Describe Basis for Conclusion:**                       |           |
+----------------------------------------------------------+-----------+
|                                                          |           |
+----------------------------------------------------------+-----------+

23\.

+----------------------------------------------------------+-----------+
| For employees working on [multiple]{.underline} programs |           |
| or cost objectives whose time is being charged on a      |           |
| direct basis, are their salaries and wages supported by  |           |
| time distribution records?                               |           |
|                                                          |           |
| \[OMB Circular A-21, J.10\]                              |           |
+----------------------------------------------------------+-----------+
| **Describe Basis for Conclusion:**                       |           |
+----------------------------------------------------------+-----------+
|                                                          |           |
+----------------------------------------------------------+-----------+

[H. Indirect Costs]{.underline}

24\.

  ------------------------------------------------------------- ---------
  a\. Are indirect costs charged to the program?                

  **Describe Basis for Conclusion:**                            

                                                                
  ------------------------------------------------------------- ---------

+----------------------------------------------------------+-----------+
| b.  If indirect costs are charged to the program, has a  |           |
|     Cost Allocation Plan and/or an Indirect Cost Rate    |           |
|     proposal been developed in accordance with OMB       |           |
|     Circular A-21, J.10?                                 |           |
|                                                          |           |
|     \[HBCU Grant Agreement, Section 12, Indirect Costs\] |           |
+----------------------------------------------------------+-----------+
| **Describe Basis for Conclusion:**                       |           |
+----------------------------------------------------------+-----------+
|                                                          |           |
+----------------------------------------------------------+-----------+

+----------------------------------------------------------+-----------+
| c.  Is there any evidence to indicate that costs are not |           |
|     being billed in accordance with the Indirect Cost    |           |
|     Rate?                                                |           |
|                                                          |           |
|     \[HBCU Grant Agreement, Section 12, Indirect Costs;  |           |
|     OMB Circular A-21, J.10\]                            |           |
+----------------------------------------------------------+-----------+
| **Describe Basis for Conclusion:**                       |           |
+----------------------------------------------------------+-----------+
|                                                          |           |
+----------------------------------------------------------+-----------+

[i. Minority-Owned Financial Institutions]{.underline}

25\.

+------------------------------------------------------------+---------+
| Has the HBCU used minority-owned financial institutions in |         |
| conjunction with the grant program? (**Note**: Because     |         |
| program participants are [not required]{.underline} to use |         |
| minority-owned financial institutions but encouraged to do |         |
| so pursuant to 24 CFR Section 84.22(j), a "No" response to |         |
| this question would **NOT** constitute a finding.)         |         |
|                                                            |         |
| \[24 CFR 84.44(b)\]                                        |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

[J. OMB Circular A-133: Audits of States, Local Governments, and
Non-Profit Organizations]{.underline}

> **[Instructions]{.underline}:** The HBCU program is subject to OMB
> Circular A-133, which establishes audit requirements pursuant to the
> Single Audit Act Amendments of 1996 . The Circular defines
> responsibilities for implementing and monitoring those requirements.
> Program participants that, in turn, provide Federal funds to secondary
> organizations are called pass-through entities. For simplification
> purposes, the term "subrecipient" will be used here to refer to all
> such secondary organizations. Pass-through entities are required by
> OMB A-133, §\_\_\_.400(d) to establish systems to oversee subrecipient
> compliance with A-133. This section of questions is designed to assist
> in determining whether the HBCU is in compliance with the required
> elements of an audits management system. An audits management review
> worksheet is attached to this Exhibit that can be used to help
> document the results from testing a sample of grants to subrecipients
> against the HBCU's control system.

26\.

  ------------------------------------------------------------- ---------
  Does the HBCU meet the threshold, or have any subrecipients   
  that meet the threshold, for having a single audit performed? 
  If no, skip questions 27 through 46 and the Audit Review      
  Worksheet.                                                    

  **Describe Basis for Conclusion:**                            

                                                                
  ------------------------------------------------------------- ---------

27\.

+-----------------------------------------------------------------------+
| What is the HBCU's means of ensuring that audits are conducted to     |
| meet all of the following:                                            |
|                                                                       |
| a.  at the proper time? \[OMB Circular A-133, §\_\_\_.320(a)\]        |
|                                                                       |
| b.  by independent, qualified personnel? \[OMB Circular A-133,        |
|     §\_\_\_.305\]                                                     |
|                                                                       |
| c.  In a manner that meets the Comptroller General's audit standards? |
|     \[OMB Circular A-133, §\_\_\_.500\]                               |
|                                                                       |
|     \[HBCU Grant Agreement, Section 20, Audit Requirements\]          |
+-----------------------------------------------------------------------+
| **Describe Basis for Conclusion:**                                    |
+-----------------------------------------------------------------------+
|                                                                       |
+-----------------------------------------------------------------------+

28\.

+------------------------------------------------------------+---------+
| In reviewing the latest audit report, does it indicate     |         |
| that the financial statements contained therein present    |         |
| fairly the HBCU's financial position and the results of    |         |
| its financial operations in accordance with generally      |         |
| accepted accounting principles?                            |         |
|                                                            |         |
| \[OMB Circular A-133, §\_\_\_.400(d)(4) and                |         |
| §\_\_\_.500(b)\]                                           |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

29\.

+-----------------------------------------------------------------------+
| a.  What is the HBCU's procedure for informing subrecipients of the   |
|     OMB Circular A-133 audit requirements?                            |
|                                                                       |
|     \[HBCU Grant Agreement, Section 17, Flow Down Procedures; OMB     |
|     Circular A-133, §\_\_\_.400(d)(2)\]                               |
+-----------------------------------------------------------------------+
| **Describe Basis for Conclusion:**                                    |
+-----------------------------------------------------------------------+
|                                                                       |
+-----------------------------------------------------------------------+

+------------------------------------------------------------+---------+
| b.  Does the HBCU ensure that each subrecipient expending  |         |
|     \$500,000 or more in Federal awards during the         |         |
|     subrecipient's fiscal year meet the audit requirements |         |
|     of OMB Circular A-133?                                 |         |
|                                                            |         |
|     \[HBCU Grant Agreement, Section 20, Audit              |         |
|     Requirements; 24 CFR 84.26; OMB Circular A-133,        |         |
|     §\_\_\_.400(d)(4) and §\_\_\_.200\]                    |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

30\.

+-----------------------------------------------------------------------+
| Do the audit reports reviewed indicate that the financial statements  |
| present fairly the subrecipients' financial position and the results  |
| of their financial operations in accordance with generally accepted   |
| accounting principles?                                                |
|                                                                       |
| \[HBCU Grant Agreement, Section 20, Audit Requirements; OMB Circular  |
| A-133, §\_\_\_.400(d)(4) and §\_\_\_.500(b)\]                         |
+-----------------------------------------------------------------------+
| **Describe Basis for Conclusion:**                                    |
+-----------------------------------------------------------------------+
|                                                                       |
+-----------------------------------------------------------------------+

31\.

+-----------------------------------------------------------------------+
| How does the HBCU ensure that each subrecipient audit has determined  |
| whether the subrecipient has internal accounting and other control    |
| systems to provide reasonable assurance that it is managing Federal   |
| financial assistance programs in compliance with applicable laws and  |
| regulations?                                                          |
|                                                                       |
| \[HBCU Grant Agreement, Section 20, Audit Requirements; 24 CFR 84.26; |
| 24 CFR 84.51(a); OMB Circular A-133, §\_\_\_.400(d)(3) and (4), as    |
| well as §\_\_\_.500(c)\]                                              |
+-----------------------------------------------------------------------+
| **Describe Basis for Conclusion:**                                    |
|                                                                       |
| **     **                                                             |
+-----------------------------------------------------------------------+

32\.

+-----------------------------------------------------------------------+
| How does the HBCU ensure that each audit has determined whether its   |
| subrecipients have complied with laws and regulations that may have a |
| material effect on their financial statements and on each major       |
| Federal assistance program?                                           |
|                                                                       |
| \[HBCU Grant Agreement, Section 20, Audit Requirements; OMB Circular  |
| A-133 §\_\_\_.400(d)(3) and (4), as well as §\_\_\_.500(d) \]         |
+-----------------------------------------------------------------------+
| **Describe Basis for Conclusion:**                                    |
+-----------------------------------------------------------------------+
|                                                                       |
+-----------------------------------------------------------------------+

33\.

+-----------------------------------------------------------------------+
| How does the HBCU ensure that audit reports are submitted within the  |
| earlier of: (i) thirty (30) days after receipt of the auditor's       |
| report(s), or (ii) nine (9) months after the end of the audit period? |
|                                                                       |
| \[HBCU Grant Agreement, Section 20, Audit Requirements; OMB Circular  |
| A-133, §\_\_\_.235(c)(1) and §\_\_\_.320(a)\]                         |
+-----------------------------------------------------------------------+
| **Describe Basis for Conclusion:**                                    |
+-----------------------------------------------------------------------+
|                                                                       |
+-----------------------------------------------------------------------+

34\.

+-----------------------------------------------------------------------+
| How does the HBCU ensure that audit costs are allowable as a direct   |
| cost or as an allocated indirect cost, as determined in accordance    |
| with the applicable OMB cost principles?                              |
|                                                                       |
| \[OMB Circular A-21, J.5; OMB Circular A-133, §\_\_\_.400(d)(4) and   |
| §\_\_\_.230\]                                                         |
+-----------------------------------------------------------------------+
| **Describe Basis for Conclusion:**                                    |
+-----------------------------------------------------------------------+
|                                                                       |
+-----------------------------------------------------------------------+

35\.

+------------------------------------------------------------+---------+
| Does the HBCU have a means for determining what corrective |         |
| actions by the subrecipient are necessary and appropriate  |         |
| to resolve findings and that such actions are taken?       |         |
|                                                            |         |
| \[HBCU Grant Agreement, Section 17, Flow Down Provisions;  |         |
| 24 CFR 84.41; OMB Circular A-133, §\_\_\_.400(d)(5)\]      |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

36\.

+------------------------------------------------------------+---------+
| Does the HBCU ensure that management decisions for audit   |         |
| findings are issued within six months after receipt of     |         |
| subrecipient audit reports, and provide follow-up to       |         |
| ensure that its subrecipients take appropriate and timely  |         |
| corrective actions?                                        |         |
|                                                            |         |
| \[HBCU Grant Agreement, Section 20, Audit Requirements;    |         |
| OMB Circular A-133, §\_\_\_.400(d)(5)\]                    |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

37\.

+------------------------------------------------------------+---------+
| Does the HBCU have a means for deciding whether            |         |
| subrecipient audits necessitate adjustments of the HBCU's  |         |
| records?                                                   |         |
|                                                            |         |
| \[HBCU Grant Agreement, Section 20, Audit Requirements;    |         |
| OMB Circular A-133, §\_\_\_.400(d)(6)\]                    |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

38\.

+------------------------------------------------------------+---------+
| Did this record review disclose any items that should have |         |
| been adjusted in the HBCU's records, but were not?         |         |
|                                                            |         |
| \[HBCU Grant Agreement, Section 20, Audit Requirements;    |         |
| OMB Circular A-133, §\_\_\_.400(d)(6)\]                    |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

39\.

+------------------------------------------------------------+---------+
| Does the HBCU's system or procedure require each           |         |
| subrecipient to permit independent auditors and HBCU staff |         |
| to have access to the records and financial statements, as |         |
| necessary, to comply with the Circular?                    |         |
|                                                            |         |
| \[HBCU Grant Agreement, Section 20, Audit Requirements;    |         |
| OMB Circular A-133, §\_\_\_.400(d)(7\]                     |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

40\.

+-----------------------------------------------------------------------+
| What is the HBCU's process for reviewing and reaching determinations  |
| to accept or reject findings and properly documenting such            |
| determinations?                                                       |
|                                                                       |
| \[HBCU Grant Agreement, Section 20, Audit Requirements; OMB Circular  |
| A-133, §\_\_\_.400(d)(5)\]                                            |
+-----------------------------------------------------------------------+
| **Describe Basis for Conclusion:**                                    |
+-----------------------------------------------------------------------+
|                                                                       |
+-----------------------------------------------------------------------+

41\.

+------------------------------------------------------------+---------+
| Does the HBCU have a process for referral of               |         |
| agency-contested findings and recommendations to senior    |         |
| level officials, outside of the normal chain of command,   |         |
| for resolution?                                            |         |
|                                                            |         |
| \[HBCU Grant Agreement, Section 20, Audit Requirements;    |         |
| OMB Circular A-133, §\_\_\_.400(d)(5)\]                    |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

42\.

+------------------------------------------------------------+---------+
| a.  Does the HBCU have a system or procedure to promptly   |         |
|     inform HUD and federal law enforcement authorities of  |         |
|     illegal acts or irregularities?                        |         |
|                                                            |         |
|     \[HBCU Grant Agreement, Section 20, Audit              |         |
|     Requirements; OMB Circular A-133, §\_\_\_.400(d)(3)\]  |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

  -----------------------------------------------------------------------
  b\. If yes, what is the procedure(s)/criteria used in determining when
  to notify authorities?

  **Describe Basis for Conclusion:**

       
  -----------------------------------------------------------------------

43\.

  ------------------------------------------------------------- ---------
  Is there a procedure to establish an account receivable from  
  the subrecipient when a monetary sanction is involved?        

  **Describe Basis for Conclusion:**                            

                                                                
  ------------------------------------------------------------- ---------

44\.

  ------------------------------------------------------------- ---------
  Is there a means of ensuring consistent treatment of all      
  audit findings?                                               

  **Describe Basis for Conclusion:**                            

                                                                
  ------------------------------------------------------------- ---------

45\.

+------------------------------------------------------------+---------+
| Does the HBCU make positive efforts to use small           |         |
| businesses, minority-owned firms, and women's business     |         |
| enterprises in procuring audit services, and does its      |         |
| system encourage localities or subrecipients/subgrantees   |         |
| to do the same? (**Note**: Because program participants    |         |
| are [not required]{.underline} to use minority-owned       |         |
| financial institutions, but encouraged to do so pursuant   |         |
| to OMB Circular A-133, §\_\_\_.305(a), a "No" response to  |         |
| this question would **NOT** constitute a finding.)         |         |
|                                                            |         |
| \[24 CFR 84.22(i) and 24 CFR 84.44(b)\]                    |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

+-----------+--------------------------------+----+------------------+
| **W       |                                |    |                  |
| orksheet: |                                |    |                  |
| Guide for |                                |    |                  |
| Review of |                                |    |                  |
| HBCU**    |                                |    |                  |
|           |                                |    |                  |
| **OMB     |                                |    |                  |
| Circular  |                                |    |                  |
| A-133     |                                |    |                  |
| Audits    |                                |    |                  |
| M         |                                |    |                  |
| anagement |                                |    |                  |
| System**  |                                |    |                  |
+-----------+--------------------------------+----+------------------+
| **Name of |                                |    |                  |
| Program   |                                |    |                  |
| Parti     |                                |    |                  |
| cipant:** |                                |    |                  |
|           |                                |    |                  |
| **     ** |                                |    |                  |
+-----------+--------------------------------+----+------------------+
| **Name(s) |                                | ** |                  |
| of        |                                | Da |                  |
| Revi      |                                | te |                  |
| ewer(s)** |                                | ** |                  |
+-----------+--------------------------------+----+------------------+

**[Instructions]{.underline}:** This worksheet is intended to supplement
the information contained in the Section X. [OMB Circular A-133: Audits
of States, Local Governments, and Non-Profit Organizations]{.underline},
of this Financial Management Exhibit. Where subrecipient audits are
reviewed to confirm the implementation of the HBCU's system, select a
sample of grants and insert the names of the subrecipients in column (a)
and the fiscal year end dates in column (b) of Part I. Insert due dates
and receipt deadlines in columns (c) through (e) of Part I; and answer
"yes" or "no," as appropriate, in columns (f) through (j) of Part II.

[Part I - Receipt Deadlines]{.underline}

+---+------------------+----------+-----------+-----------+-----------+
|   | **Subrecipient   | **Fiscal | **Audit** | **Audit** | **Audit   |
|   | Name**           | Year**   |           |           | R         |
|   |                  |          | **Report  | **Due     | eceived** |
|   |                  | **End    | Date**    | Date**    |           |
|   |                  | Date**   |           |           | **Date**  |
+---+------------------+----------+-----------+-----------+-----------+
|   | \(a\)            | \(b\)    | \(c\)     | \(d\)     | \(e\)     |
+---+------------------+----------+-----------+-----------+-----------+
| 1 |                  |          |           |           |           |
| \ |                  |          |           |           |           |
| . |                  |          |           |           |           |
+---+------------------+----------+-----------+-----------+-----------+
| 2 |                  |          |           |           |           |
| \ |                  |          |           |           |           |
| . |                  |          |           |           |           |
+---+------------------+----------+-----------+-----------+-----------+
| 3 |                  |          |           |           |           |
| \ |                  |          |           |           |           |
| . |                  |          |           |           |           |
+---+------------------+----------+-----------+-----------+-----------+
| 4 |                  |          |           |           |           |
| \ |                  |          |           |           |           |
| . |                  |          |           |           |           |
+---+------------------+----------+-----------+-----------+-----------+
| 5 |                  |          |           |           |           |
| \ |                  |          |           |           |           |
| . |                  |          |           |           |           |
+---+------------------+----------+-----------+-----------+-----------+
| 6 |                  |          |           |           |           |
| \ |                  |          |           |           |           |
| . |                  |          |           |           |           |
+---+------------------+----------+-----------+-----------+-----------+
| 7 |                  |          |           |           |           |
| \ |                  |          |           |           |           |
| . |                  |          |           |           |           |
+---+------------------+----------+-----------+-----------+-----------+
| 8 |                  |          |           |           |           |
| \ |                  |          |           |           |           |
| . |                  |          |           |           |           |
+---+------------------+----------+-----------+-----------+-----------+
| 9 |                  |          |           |           |           |
| \ |                  |          |           |           |           |
| . |                  |          |           |           |           |
+---+------------------+----------+-----------+-----------+-----------+
| 1 |                  |          |           |           |           |
| 0 |                  |          |           |           |           |
| \ |                  |          |           |           |           |
| . |                  |          |           |           |           |
+---+------------------+----------+-----------+-----------+-----------+

[Part II - Were Requirements Met (Yes/No)?]{.underline}

  ------ ----------- -------------- --------------- -------------- ---------------
         **A-133     **Corrective   **Corrective    **Corrective   **Corrective
         Met?**      Actions        Actions         Actions        Actions Taken
                     Accepted?**    Documented?**   Taken?**       in 6 months?**

         \(f\)       \(g\)          \(h\)           \(i\)          \(j\)

  1\.                                                                   

  2\.                                                                   

  3\.                                                                   

  4\.                                                                   

  5\.                                                                   

  6\.                                                                   

  7\.                                                                   

  8\.                                                                   

  9\.                                                                   

  10\.                                                                  
  ------ ----------- -------------- --------------- -------------- ---------------

[Part III - Conclusions]{.underline}

+-----------------------------------------------------------------------+
| Explain negative responses or delays in complying with the required   |
| deadlines.                                                            |
+-----------------------------------------------------------------------+
| **Describe Basis for Conclusion:**                                    |
|                                                                       |
| **     **                                                             |
+-----------------------------------------------------------------------+