- -

OF 

INSPECTOR GENERAL 

U.S.DEPARTMENT OF THE INTERIOR 

RISK ASSESSMENT

Risk Assessment of the 

U.S. Department of the Interior’s 

Grant Closeout Process 

Report No.: 2019-FIN-037 March 2020
 

 

 

OFFICE OF 

INSPECTOR GENERAL 

U.S.DEPARTMENT OFTHE INTERIOR 

Memorandum 

To: Kaprice Tucker 

Acting Director, Office of Grants Management 

From: Chris Stubbs 

Director, Office of Financial and Contract Audits 

Subject: Final Report – Risk Assessment of the U.S. Department of the Interior’s 

Grant Closeout Process 

Report No. 2019-FIN-037 

We completed our risk assessment of the U.S. Department of the Interior’s (DOI’s) 

grant closeout process as required by the Grants Oversight and New Efficiency (GONE) 

Act of 2016, Public Law 114-117. Our objective was to determine whether an audit or 

review of the DOI’s grant closeout process was warranted. 

Our assessment revealed that the DOI’s current closeout process is at high risk of 

inaccurate reporting and potential violation of the GONE Act. As a result, we will be 

initiating a full audit in fiscal year (FY) 2020. We will use this risk assessment to determine 

the scope of the audit of the DOI’s grant closeout process. 

This report contains one recommendation. See Attachment 1 for our scope and 

methodology. 

Background 

The GONE Act, dated January 28, 2016, requires Federal agencies to report and 

take appropriate action to close open Federal grant and cooperative agreement awards with 

periods of performance that had been expired for at least 2 years in accordance with Federal 

regulations (2 C.F.R. § 200.16 and § 200.3431

). Section 2(a)(1) of the Act requires agencies 

to submit an initial report to Congress and the Secretary of the U.S. Department of Health 

and Human Services (HHS) no later than December 31, 2017. The DOI did so in November 

2017, reporting it had 10 open grants that were 2 or more years old, totaling approximately 

$391,000. The DOI submitted an update of its progress closing these grants in November 

2018, reporting that all 10 of the open grants reported in the November 2017 initial GONE 

Act report had been closed. 

1 2 C.F.R. § 200.16, “Closeout,” and § 200.343, “Closeout” 

Office of Audits, Inspections, and Evaluations | Washington, DC 
 

Section 2(c) of the Act required the Inspector General of an agency with more than 

$500 million in annual grant funding to conduct a risk assessment to determine whether an 

audit or review of the agency’s grant closeout process was warranted. 

Risk Assessment Results 

Our risk assessment identified that the DOI’s current process for closing grants and 

cooperative agreements is at a high risk of inaccurate reporting and potential violation of 

the GONE Act. Specifically, we found an unresolved material weakness, unreported data, 

inaccurate information, policy gaps, and unsupported reports. 

Unresolved FMFIA Material Weakness 

The Federal Managers Financial Integrity Act (FMFIA) requires Federal agencies to 

report to the President and Congress on any material internal weakness they identify. We 

found that the DOI has an unresolved internal control material weakness on its FY 2018 

Financial Agency Report. The self-reported finding cited the DOI’s poor management and 

oversight of the financial assistance and tribal awards made under Public Law 93-638, 

Indian Self-Determination and Education Assistance Act (as amended) (PL 638). The DOI 

created the Financial Assistance Management Partnership (FAMP) to address this finding 

and has an estimated completion date in FY 2020. 

The Bureau of Indian Affairs’ (BIA’s) Financial and Business Management System 

(FBMS) data that we gathered indicated that many PL 638 grants and cooperative 

agreements had passed their periods of performance but had not been closed out. 

Indian Self-Determination Award Data Not Reported 

We identified that the DOI did not report Federal awards that were funded through 

PL 638. The GONE Act states that each agency must “list each Federal grant award held by 

such agency” that has been expired 2 or more years. DOI officials told us they excluded 

grants funded by PL 638 because such awards do not qualify as grants or cooperative 

agreements under 2 C.F.R. § 200.24 and § 200.51.2

 The GONE Act, however, assigns the 

definition contained in 2 C.F.R. § 200.38(a)(1) to the term “Federal grant awards.” Thus, 

GONE Act reporting requirements exist for Federal awards beyond just grants and 

cooperative agreements as those terms are defined by 2 C.F.R. § 200.24 and 

2 C.F.R. § 200.51. 

DOI officials also told us they met with the HHS and the Office of Management and 

Budget (OMB) to discuss whether PL 638 awards should be included in GONE Act 

reporting but were unable to provide any documentation supporting this meeting. Email 

correspondence from DOI officials indicated that the Bureau of Indian Affairs, Office of 

the Solicitor, and the Office of Financial Management decided not to include PL 638-

2 2 C.F.R. § 200.24, “Cooperative Agreement;” § 200.51, “Grant Agreement.” 

2 
funded awards in GONE Act reporting.3

 Further, we received no information from the HHS 

or the OMB that they were included nor the rationale upon which this decision was based. 

Our Office of General Counsel determined that while the applicable statutes and regulations 

do not explicitly include the grants in the required reporting, they do not explicitly exclude 

them. 

Using the DOI’s current web intelligence query4

 in the FBMS for FY 2018, we 

identified that the DOI may have had $12,189,362 in undisbursed PL 638 funds. Of that 

amount, $55,317 consisted of non-PL 638 expired awards from the BIA. We were unable to 

match this amount from the DOI’s query to our independent BIA grant and cooperative 

agreement data from the FBMS to determine what reporting the GONE Act may have 

required; such a determination will require an audit. 

DOI’s FBMS May Contain Some Inaccurate Information 

The DOI’s FAMP meeting minutes indicated seven challenges to tracking and 

reporting the GONE Act information within the FBMS. For instance, one challenge was the 

DOI’s inability to determine whether awards were cancelled, duplicates, or mistakes; 

another was whether the PL 638 awards’ periods of performance dates were accurate. 

Responding to these challenges, the Office of Financial Management told us it 

created a web intelligence query to gather grant and cooperative agreement data from the 

FBMS using predetermined formulas and by manipulating the data to remove grants and 

awards that it did not believe were required to be reported per the GONE Act. After the 

DOI used this query to report the FY 2017 GONE Act information, the DOI deleted the 

process and created a new web intelligence query to report the FY 2018 GONE Act 

information. We were unable to obtain a clear explanation why the original process had 

been replaced. Since this new query did not identify the FY 2017 PL 638 awards, we were 

unable to determine what may have been required to be reported for that year. We 

requested information on these seven challenges and the DOI was able to discuss only three 

of them. 

Using the DOI’s current web intelligence query on our analysis of the non-BIA DOI 

awards that have been expired for 2 years or more and have not been closed out, we found 

that there may have been an additional 13 expired awards with an undisbursed amount of 

$194,820 that should have been reported per the GONE Act in FY 2017. 

Closeout Policy Gaps Identified 

When reviewing the DOI’s policies and procedures over grant and cooperative 

agreement closeouts and the FAMP meeting minutes, we identified the DOI had closeout 

3 We reported at our exit conference and in our draft audit report sent to the DOI that the emails demonstrated the issue 

had been considered and discussed in 2017, but they did not provide sufficient evidence of a consensus or written 

explanation for the position taken. We reviewed an additional email thread the DOI sent in September 2019 in response to 

our draft report, which provided sufficient evidence that indicated that the DOI worked with other agencies to determine 

whether PL 93-638 awards should be reported pursuant to the GONE Act; the DOI documented its conclusion. 4 The web intelligence query is a SAP application within the FBMS system that retrieves data from the system to create 

reports. 

3 
  

policy gaps; for example, the DOI’s policies and procedures did not identify how long the 

DOI had to close out each award. The C.F.R. § 200.343(g) states, “The Federal awarding 

agency or pass-through entity should complete all closeout actions for Federal awards no 

later than 1 year after receipt and acceptance of all required final reports.” 

The DOI’s FAMP meeting minutes indicated the DOI was also unable to validate if 

some awards were either cancelled or a mistake. The DOI discussed adding a policy that 

requires a minimum amount of documentation to support and validate a closeout action on 

these types of awards. We reached out to the DOI to inquire if it had resolved the identified 

challenges but were told it had not finalized new policies. Not finalizing the new policies 

leaves gaps in the grant closeout process that can lead to awards not being closed out within 

the required timeframe. 

Unsupported GONE Act Reports 

We found the DOI was unable to show us how it created and supported its FY 2017 

and FY 2018 GONE Act reports. The DOI told us the individual responsible for creating 

the reports had retired and left no support for the reports, procedures to show how to gather 

the information from the FBMS, or instructions on how to manipulate the system outside of 

the FBMS to work around known FBMS information errors. Further, officials told us that 

the now-retired employee had not cross-trained anyone on GONE Act functions. As a 

result, we were unable to confirm the accuracy and origin of the data to support what the 

DOI reported in FY 2017 and FY 2018. 

Conclusion 

We identified five significant risks related to the DOI’s grant closeout process and 

compliance with the GONE Act: the DOI had an unresolved FMFIA internal control 

material weakness to improve management and oversight of financial assistance and tribal 

awards made under PL 638 on its FY 2018 Financial Agency Report; all required award 

data may not have been reported; some grants and cooperative agreements may have 

inaccurate information within the FBMS; there are gaps in the closeout policy; and the DOI 

could not provide adequate support for the FY 2017 and FY 2018 GONE Act reports. 

Overall, we concluded that the Department’s risk of inaccurate reporting was high. As a 

result, we will initiate an audit of DOI’s grant closeout in FY 2020. 

We make one recommendation to help the DOI improve its grant closeout process 

and compliance with the GONE Act. Based on the DOI’s nonconcurrence with that 

recommendation, we consider it resolved and implemented. See Attachment 2 for the 

DOI’s full response and Attachment 3 for the status of the recommendation. 

We recommend that the DOI: 

1. Work with other agencies to determine if funding per Public Law 93-638,

Indian Self-Determination and Education Assistance Act (as amended), should

be reported pursuant to the GONE Act and document the conclusion

4 
DOI Response: The DOI does not concur with the recommendation because the 

DOI’s Office of Financial Management (PFM) received prior concurrence from 

the DOI’s Office of the Solicitor (SOL) and the Office of Management and 

Budget (OMB) on their decision to exclude Indian Self-Determination and 

Education Assistance Act awards from the 2017 DOI GONE Act Report. The 

PFM provided the OIG auditor with several emails received from the SOL and 

the OMB documenting the concurrence. 

OIG Comment: We consider this recommendation resolved and implemented. 

We reviewed the April 9, 2017 and August 30, 2017 emails in the DOI’s 

response during our risk assessment fieldwork (see Attachment 2). We reported 

at our exit conference and in our draft audit report sent to the DOI that the 

emails demonstrated the issue had been considered and discussed in 2017, but 

they did not provide sufficient evidence of a consensus or written explanation 

for the position taken. We reviewed an additional email thread the DOI sent in 

September 2019 in response to our draft report, which provided sufficient 

evidence that indicated that the DOI worked with other agencies to determine 

whether PL 93-638 awards should be reported pursuant to the GONE Act; the 

DOI documented its conclusion.5 

If you have any questions about this report, please contact me at 202-208-5745. 

The legislation creating the Office of Inspector General requires that we report to 

Congress semiannually on all audit, inspection, and evaluation reports issued; actions taken 

to implement our recommendations; and recommendations that have not been 

implemented. 

5 The OIG does not take a position on whether PL 93-638 awards should be included or excluded from the GONE Act 

requirements. 

5 
Attachment 1: Scope and Methodology 

Scope 

Our assessment period covered the U.S. Department of the Interior’s (DOI’s) initial 

fiscal year (FY) 2017 and final FY 2018 Grants Oversight and New Efficiency (GONE) 

Act reports, which we found in the DOI’s FY 2017 and FY 2018 Financial Statements in 

the Other Information section. 

Methodology 

We used the U.S. Government Accountability Office’s Government Auditing 

Standards (Yellow Book), section 6.15 a through g, as guidance to help us determine the 

risk levels used in this memorandum. The team also: 

 Reviewed applicable laws and regulations

 Reviewed the DOI’s policies, procedures, and memorandums over its grant

closeout process

 Conducted interviews with DOI personnel responsible for oversight of the grant

closeout process

 Reviewed the DOI’s FY 2017 and FY 2018 GONE Act submissions

 Reviewed the DOI’s Financial Assistance Management Partnership meeting

minutes

 Attempted to review the grant data used for the DOI’s FY 2017 submission and

FY 2018 update

 Reviewed grant data pulled from the DOI’s Financial and Business Management

System (FBMS)

Since the DOI has several challenges identifying inaccurate information for some of 

the grant and cooperative agreement data within the FBMS, we were unable to rely on the 

data it provided to us, the data we gathered using the FBMS programmed query system, or 

the data we independently gathered not using the programmed query system. 

6 
Attachment 2: Response to Draft Report 

The DOI’s response to our draft report follows on the next page. 

7 
United States Department of the Interior 

OFFICE OF THE SECRETARY 

Washington, DC 20240 

To: Mark L. Greenblatt 

Inspector General 

From: Kaprice Tucker, Acting Direct r 

Office of Grants Management 

Date: 11/04/2019 

Subject: Response to Draft Audit Report - Risk Assessment of the U.S. Department of the Cnterior 

Grant Closeout Process. Report No. 20 I 9-FIN-037 

This memorandum is written in response to your memorandum of September 16, 2019, which pertains to 

the risk assessment of the U.S. Department of the Interior's (DOl's) grant closeout process as required by 

the Grants Oversight and New Efficiency (GONE) Act of 2016, Public Law 114-117. 

The assessment revealed that DO f's current closeout process is at high risk of inaccurate reporting and 

potential violation of the GONE Act. As a result, OIG will initiate a full audit in fiscal year (FY) 2020 

and the risk assessment performed will be used to determine the scope of the audit of the DOf's grant 

c loseout process. 

 Recommendation #I: Work with other agencies to determine if funding per Public Law 93-638, 

Indian Self Determination and Education Assistance Act (as amended), should be reported 

pursuant to the GONE Act. 

• RESPONSE: DOI does not concur with the recommendation because PFM received 

prior concurrence from the DOI Office of the Solicitor (SOL) and the Office of 

Management and Budget (0MB) on their decision to exclude ISDEAA awards from the 

20 17 DOI GONE Act Report. PFM provided the 010 Auditor several emails 

documenting the concurrence received from the SOL and 0MB. A summary of the 

emails documenting the SOL and 0MB concurrence received by PFM are listed below: 

• On April 9, 2017, the Office of the Solicitor (SOL) provided an opinion that 

supported the exclusion ofJSDEAA awards from the 2017 GONE Act Report to 

the Indian Affairs (BIA) Director of the Division of Jntemal Evaluation and 

Assessment. This email was shared with the PFM Division Chief for Internal 

Control and Audit Follow-up. The Office of Financial Management (PFM) 

concurred with the recommendation provided by the SOL. 

• On August 30, 2017, representatives from BIA and PFM met via phone 

conference with the 0MB GONE Act Reporting contact to request concurrence 

for excluding lSDEAA awards from the 2017 DOI GONE Act Report. The 

0MB coordinator provided their concurrence during that meeting. Notes from 

the meeting are documented by the PFM coordinator in an email dated August 

30,2017. 

• Jn an effort to document the concurrence received from 0MB, PFM contacted 

the 0MB GONE Act Reporting contact person to request verification of 0MB 

concurrence with PFM's decision to exclude ISDEAA awards from DOI 2017 

GONE Act Report. The 0MB contact responded via email on September 5, 

Attachment 2
2019 to verify 0MB concurred with DOI's decision to exclude ISDEAA Awards 

from this report. 

• Target Completion Date: November 4, 2019. 

• Responsible Official: PGM Director/PFM Director 

The copies of the emails mentioned above are available as attachments to this memorandum. 

Questions about the actions taken by PGM may be directed to Kaprice Tucker, Acting Director for the 

Office of Grants Management, at (202) 513-7645 or by e-mail at Kaprice Tucker@ios.doi.gov . 

Attachments: 

April 9, 2017 email chain that includes the opinion and concurrence from the SOL contact. 

August 30, 20 17 email chain that includes notes from the meeting between PFM, BIA, and 0MB 

contacts. 

September 5, 2019 email chain that includes 0MB verification of concurrence provided by 0MB 

contacts. 

Attachment 2
1 

Attachment 3: Status of Recommendations 

Recommendation Status Action Required 

Resolved and No action is required. implemented 

8 
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