Audit Report

OIG-20-037

DOMESTIC AND INTERNATIONAL ASSISTANCE PROGRAMS

Improvements Are Needed in the CDFI Fund’s Administration of 

Technical Assistance Awards

June 12, 2020

Office of

Inspector General

Department of the Treasury
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Contents 

Audit Report 

Background ........................................................................................ 4 

Technical Assistance Awards............................................................ 5 

CDFI Certification ............................................................................ 6 

Finding 1: Thirty-Nine Percent of Non-Certified TA Awardees Did Not 

Achieve CDFI Certification as Required by Assistance Agreement(s).......... 7 

Recommendations ......................................................................... 12 

Finding 2: Monitoring Activities Were Not Sufficient to Ensure TA 

Awardee Compliance ......................................................................... 14 

Recommendations ......................................................................... 19 

Appendices 

Appendix 1: Objectives, Scope, and Methodology................................. 23 

Appendix 2: CDFI Fund Management Response .................................... 27 

Appendix 3: Major Contributors to This Report ..................................... 32 

Appendix 4: Report Distribution .......................................................... 33 

Abbreviations 

AMIS Awards Management Information System 

Assistance Agreement Community Development Financial Institutions Fund 

Assistance Agreement 

CCME Certification, Compliance Monitoring and Evaluation 

CDFI community development financial institution 

CDFI Fund Community Development Financial Institutions Fund 

FA Financial Assistance 

FY fiscal year 

GAO Government Accountability Office 

JAMES Joint Audit Management Enterprise System 

NACA Native American CDFI Fund Assistance 

NCMR Noncompliance Memo Replacement 

OIG Office of Inspector General 

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OMB Office of Management and Budget 

RFI Request for Information 

RMS Reports Monitoring System 

SOPs CDFI Program and Native Initiatives Standard Operating 

Procedures 

TA Technical Assistance 

TD Treasury Directive 

TD P TD Publication 

Treasury Department of the Treasury 

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Audit OIG Report 

The Department of the Treasury 

Office of Inspector General 

June 12, 2020 

Jodie Harris 

Director, Community Development Financial Institutions Fund 

This report presents the results of our audit of the Community 

Development Financial Institutions (CDFI) Fund’s Technical 

Assistance (TA) awards made from fiscal year (FY) 2006 through 

FY 2012. The objective of our audit was to determine whether 

awardees met the CDFI Fund’s certification requirement as outlined 

in their TA Assistance Agreement(s).

1 As part of our audit, we also 

assessed CDFI Fund’s monitoring activities for ensuring TA 

awardees’ compliance with their Assistance Agreement(s). The 

scope of our audit comprised all 315 TA awards totaling 

$26,862,063 made to 269 entities from FY 2006 through FY 

2012. Within this scope, 105 TA awardees comprising 

$9,338,317 were not CDFI certified at the time of their awards. 

We tested all 105 TA awards for compliance with CDFI Fund’s 

certification requirements. We also selected a statistical sample of 

75 awardees (comprising $6,702,518) from the population of 315 

TA awards for the purpose of assessing CDFI Fund’s monitoring 

activities for ensuring awardees’ compliance with their TA 

Assistance Agreement(s). Appendix 1 provides more detail on our 

audit objective, scope, and methodology. 

In brief, we found that 41 of the 105 non-certified TA awardees 

(39 percent) did not achieve CDFI certification in accordance with 

their Assistance Agreement(s). That is, 10 non-certified TA 

awardees received certification subsequent to the performance 

periods stated in their Assistance Agreement(s), 15 non-certified 

TA awardees did not apply for certification, and 16 non-certified 

TA awardees applied but were declined CDFI certification. In all, 

1 A certified CDFI is a non-governmental, specialized financial institution that works in low-income 

communities or serves individuals or businesses that lack access to mainstream financial institutions. To 

become a certified CDFI, an applicant must submit a Certification Application for approval by the CDFI 

Fund. 

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only 5 of the non-certified TA awardees were found in default of 

their Assistance Agreement(s), and 26 non-certified TA awardees 

were found non-compliant but not in default at the discretion of the 

CDFI Fund. The Assistance Agreement(s) required non-certified TA 

awardees to obtain CDFI certification by the end of the two-year 

performance period or by a date specified.2 

In addition, we found that CDFI Fund’s monitoring activities did not 

ensure awardee compliance with their Assistance Agreement(s). 

Specifically, we found that Certification, Compliance Monitoring, 

and Evaluation (CCME) staff did not (1) follow up on delinquent 

annual reports, (2) review awardees’ annual reports timely and 

close out3 TA awards after final performance period ends, and (3) 

monitor awardees’ progress towards achieving CDFI certification. 

Furthermore, CDFI Fund’s CDFI Program and Native Initiatives 

Standard Operating Procedures (SOP) in place during FY 2006 

through FY 2012 did not include procedures specific to addressing 

these control activities. 

We recommend that the Director of the CDFI Fund (1) consider 

requiring a reasonable CDFI Certification Application deadline for 

awardees in the Assistance Agreement(s) that will allow CCME 

staff sufficient review time and make certification decisions within 

the 90 calendar day timeline outlined in the CDFI Certification 

Procedures; (2) reassess CCME staff resources necessary to review 

CDFI Certification Application(s) and make certification decisions 

within the 90 calendar day timeline outlined in the CDFI 

Certification Procedures; (3) reassess the significance given to TA 

awardees’ non-compliance with the CDFI certification requirement 

of the Assistance Agreement(s) when making a determination of 

default or no-default since one of several goals is for a non-certified 

entity to build capacity and become a certified CDFI; (4) ensure 

that CCME staff fully document the reasons for determinations of 

default or no default when TA awardees are non-compliant with 

their Assistance Agreement(s); (5) establish in SOPs a reasonable 

2 Beginning with the FY 2018 funding round, non-certified TA awardees are required to achieve CDFI 

certification by the end of a three-year performance period or a date specified in the Assistance 

Agreement(s) with the CDFI Fund. 3 Award closeout is the process by which a Federal awarding agency determines that all applicable 

administrative actions and all required work of the award have been completed by the recipient and the 

Federal awarding agency. 

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timeline for follow up on TA awardees’ delinquent annual reports; 

(6) reassess information technology capabilities to determine if 

system users can be automatically alerted of delinquent reports; (7) 

assess CCME staffing levels to ensure sufficient compliance 

monitoring is performed for making awardee compliance 

determinations and closing out awards within the timeline 

established in the updated SOP; (8) ensure the closeout of all 315 

TA awards within the FY 2006 through FY 2012 scope of this 

report; and (9) establish and implement procedures that require 

monitoring of TA awardees’ progress toward meeting CDFI 

certification requirements prior to submitting a CDFI Certification 

Application. 

In a written response, CDFI Fund management concurred with all 

of the report’s recommendations. According to management, the 

CDFI Fund implemented the following corrective actions to address 

each recommendation: (1) added a performance goal to their 

Assistance Agreement(s) that requires TA awardees to submit a 

CDFI Certification Application one year prior to their requirement to 

become certified, and implemented the Awards Management 

Information System (AMIS) to better review certification 

applications; (2) assesses the need for staffing on an on-going 

basis, subject to budget constraints, and utilizes AMIS to monitor 

certification application reviews; (3) implemented a process to 

assess the severity of an awardee’s noncompliance when making a 

determination of default or no default, and increased the level of 

severity given to TA awardees that are noncompliant with the 

certification requirement by finding them in default and providing 

them with an opportunity to cure; (4) enhanced policies and 

procedures to ensure compliance determinations are fully 

documented; (5) operationalized compliance SOPs within AMIS to 

enable CCME to follow up on delinquent reports within a 

reasonable timeframe; (6) implemented system requirements in 

AMIS that send automated report due date reminders and overdue 

report notices to awardees; (7) assesses the need for staffing on 

an on-going basis subject to budget constraints, and uses 

automated AMIS features to ensure compliance determinations are 

made within the SOPs timeframes; (8) closed out all 315 TA 

awards within the FY 2006 through FY 2012 scope of this audit 

report; and (9) added a performance goal in the Assistance 

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Agreement that requires recipients to submit a CDFI Certification 

Application one year prior to the requirement for the recipient to 

become a certified CDFI and aligned the CDFI application the 

certification policy to assist in assessing applicants’ ability to meet 

the requirement. Also, CCME is actively monitoring awardees 

progress towards certification in AMIS and conducting monthly 

conference calls to provide technical assistance to organizations 

seeking CDFI certification. 

We consider CDFI Fund’s corrective actions, if implemented as 

stated, to be responsive to our recommendations. Regarding 

management’s response to updating SOPs for delinquent report 

follow up, we encourage management to update its compliance 

SOPs to incorporate additional timeframes for CCME staff to follow 

up directly with recipients on reports that remain delinquent after 

receiving AMIS notifications. Overall, management will need to 

record its stated corrective actions and implementation dates in the 

Joint Audit Management Enterprise System (JAMES), Treasury’s 

audit recommendation tracking system. We have summarized 

management’s response in the recommendation sections of this 

report. Management’s written response, in its entirety, is included 

as appendix 2 of this report. 

Background 

The Riegle Community Development and Regulatory Improvement 

Act of 19944 established the CDFI Fund to promote economic 

revitalization and community development through financial 

assistance to CDFIs in the form of grants, loans, equity and other 

investments. In July 1995, the CDFI Fund began operations within 

the Department of the Treasury (Treasury) with all powers and 

rights of the administrator assigned to the Secretary of the 

4 Public Law 103-325, 108 Stat. 2160; September 23, 1994 

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Treasury,

5 who delegated authority to the Director of the CDFI 

Fund in November 1995.6 

 

Since 1996, the CDFI Fund has provided financial and technical 

assistance to CDFIs operating in underserved communities through 

the CDFI Program and Native American CDFI Assistance (NACA) 

Program. The CDFI Fund also supports community development 

through the Bank Enterprise Award Program, which provides grants 

to institutions insured by the Federal Deposit Insurance 

Corporation. The CDFI Fund’s role in promoting community and 

economic development expanded in FY 2001 when the Secretary 

of the Treasury delegated authority to the CDFI Fund to award tax 

credits to community development entities investing in underserved 

communities. The CDFI Fund’s portfolio continued to expand with 

the creation of the Capital Magnet Fund in FY 2008, which makes 

competitively awarded grants to finance affordable housing. The 

CDFI Bond Guarantee Program was created in FY 2010 to provide 

long-term credit to CDFIs at below market interest rates. 

The CDFI Program grants assistance to entities that serve lowincome individuals and communities that lack access to affordable 

financial products and services. There are two types of grant 

awards: TA awards and Financial Assistance (FA) awards. 

Technical Assistance Awards 

TA awards are grants intended to build the capacity of an existing 

certified CDFI or an entity seeking to become certified as a CDFI. 

TA awards may be used for compensation, personnel services and 

fringe benefits, professional services, travel, training and education, 

equipment, and supplies. Only CDFIs certified by the CDFI Fund 

may receive FA awards, but TA awards may be made to both 

certified CDFIs and non-certified entities. During the FY 2006 

through FY 2012 funding rounds, an entity seeking certification 

must become certified within two years after receiving the TA 

award or the date specified in the Assistance Agreement(s) with 

the CDFI Fund. 

5 Public Law 104-19, 109 Stat. 194; July 27, 1995 6 Treasury Directive 13-05, Delegation of Authority for Administering the Community Development 

Financial Institutions Fund; October 31, 2013 

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The CDFI Fund annually publishes a Notice of Funds Availability, 

which specifies the amount of TA funding available for an award 

round. During its funding rounds for fiscal years 2006 through 

2012, the CDFI Fund awarded 315 TA grants to 269 awardees,7 

totaling $26,862,063.

8 Of this amount, $9,338,317 of awards 

were made to 105 non-CDFI certified entities. Individual TA awards 

during this period were limited to a maximum of $100,000.9 

 

Prior to receiving funds, all awardees must sign an Assistance 

Agreement that contains the award terms and conditions, including 

the award amount, uses, targeted market or activities, performance 

goals and measures, and reporting requirements. For TA awards 

made during FY 2006 through FY 2012, Assistance Agreement(s) 

had a two-year performance period, while Assistance Agreement(s) 

that combined FA and TA awards had a three-year performance 

period. 

CDFI Certification 

CDFI certification is a designation given by the CDFI Fund that is 

generally effective for three years (or other period set by the CDFI 

Fund) unless otherwise terminated.10 To become certified, entities 

must submit a CDFI Certification Application (separate from its 

application for TA award) and must (1) be a legal entity; (2) have a 

primary mission of promoting community development; (3) be a 

financing entity; (4) provide development services along with 

financing activities; (5) serve one or more target market(s); (6) 

maintain accountability to its defined target market(s); and (7) be a 

non-government entity and not under the control of any 

government entity. 

The CCME staff within the CDFI Fund are responsible for 

monitoring awardee compliance with their Assistance 

7 Thirty-six entities received more than one TA award, including eight entities that received three TA 

awards and one entity that received four TA awards. 8 Does not include Native American entities, which received separate Congressional appropriations for 

TA awards. 

9 Maximum TA award amount increased to $125,000 in fiscal year 2014, which was not within the 

scope of this audit. 10 Beginning with the FY 2016 funding rounds, the CDFI Fund required all certified CDFIs to submit an 

Annual Certification and Data Collection Report, which allows the CDFI Fund to annually assess CDFIs’ 

compliance with certification guidelines. 

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Agreement(s). Compliance monitoring includes, among other 

activities, review of TA awardee annual reports and, if necessary, 

desk reviews to follow-up on reported information. Annual reports 

are due 180 days after an awardee’s FY end, and include the 

following: 

• the Financial Report, which includes the awardee’s financial 

statements and related auditor’s and accountant’s review 

reports; 

• the Institution Level Report, which captures an awardee’s 

total financial activity which the CDFI Fund uses to 

determine the awardee’s compliance with the performance 

goals set forth in the Assistance Agreement(s); 

• the audit reports required by the previous Office of 

Management and Budget Circular (OMB) No. A-133 (if 

required, this report is due 270 days after an awardee’s FYend);

11 

• the Uses of TA Report, which identify how a TA awardee 

specifically used its award; 

• the Explanation of Noncompliance, which identifies the 

reason an awardee failed to meet a performance goal, as 

applicable; and 

• the Federal Financial Report/Standard Form 425, which 

captures the financial status of an agreement at a specific 

point in time including grant cash receipts and 

disbursements, expenditures and obligations, and program 

income. 

Finding 1 Thirty-Nine Percent of Non-Certified TA Awardees 

Did Not Achieve CDFI Certification as Required by 

Assistance Agreement(s) 

Assistance Agreement(s) required non-certified TA awardees to 

obtain CDFI certification by the end of the two-year performance 

period or other date assigned by the CDFI Fund. In the case of the 

315 TA awards made from FY 2006 through FY 2012, 210 

11 OMB Circular No. A-133 (62 FR 35278) was superseded on December 26, 2013, by the issuance of 

2 CFR Part 200, Uniform Administrative Requirements, Costs Principles, and Audit Requirements for 

Federal Awards. This guidance became applicable for awards made December 26, 2014. 

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awardees were already CDFI certified at the time of their awards. 

Of the remaining 105 non-certified TA awardees, only 57 of them 

(or 54 percent) achieved CDFI certification within the performance 

periods stated in their respective Assistance Agreement(s). Another 

seven non-certified awardees (or 7 percent) with awarded amounts 

totaling $570,875 reported their inability to become CDFI certified 

and declined or returned funds to the CDFI Fund.12 The remaining 

41 non-certified awardees (or 39 percent) with TA awards totaling 

$3,805,224 did not achieve CDFI certification in accordance with 

their Assistance Agreement(s) as follows: 

• 10 awardees were CDFI certified subsequent to the 

performance periods stated in their Assistance Agreement(s), 

which included 5 awardees with TA awards totaling 

$460,664 that applied for CDFI certification during their 

performance periods; and 5 awardees with TA awards 

totaling $455,015 that applied for and received CDFI 

certification after their performance periods; 

• 15 awardees with TA awards totaling $1,377,203 never 

applied for CDFI certification; and 

• 16 awardees with TA awards totaling $1,512,342 applied 

for CDFI certification but were declined. 

Awardees that Were CDFI Certified Subsequent to Performance 

Periods 

Of the 10 awardees that the CCME certified subsequent to their 

performance periods, 5 awardees applied for CDFI certification 

within their stated performance periods and 5 of them did not. Of 

the 5 awardees which submitted a CDFI Certification Application 

within their stated performance periods, 3 submissions were 

between 4 and 88 days before the performance period ended. That 

said, the CDFI Fund did not stipulate a CDFI Certification 

Application deadline in its TA Assistance Agreement(s) but did 

state that it “strongly encourages the Awardee to submit its 

12 Of the seven non-certified awardees that reported inability to become CDFI certified, five of them 

declined to receive awards totaling $478,885, and two returned awards totaling $91,990. 

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certification application no later than 90 days prior to the 

performance measure date.” 

Additionally, the CDFI Certification Procedures handbook states 

that certification “decisions will be made within 90 calendar days 

of application submission.” For 9 of the 10 awardees CDFI certified 

subsequent to their respective performance periods, it took the 

CCME staff between 95 and 487 days to review the CDFI 

Certification Application(s)13 and make certification decisions. 

CCME officials informed us that they did not consistently meet the 

90-day decision timeline because (1) competing priorities were 

pulling resources from the CDFI Certification Application review 

process, which delayed rendering of a certification determination; 

and (2) awardees may have needed additional time to make 

corrections to their CDFI Certification Application and demonstrate 

they met certification requirements. 

Overall, both TA awardees and CCME staff were not fully meeting 

their respective responsibilities regarding CDFI certification. The 

lack of an explicit CDFI Certification Application deadline in the 

Assistance Agreement(s) along with CCME staff’s delayed 

application reviews and certification decisions resulted in disparate 

treatment of TA awardees. That is, not all awardees were treated 

consistently as certain awardees received CDFI certification when 

submitting a CDFI Certification Application after their performance 

period ended. 

Awardees that Never Applied or Were Declined CDFI Certification 

As discussed in the background section of this report, an entity 

must meet the following requirements to become CDFI certified: (1) 

be a legal entity; (2) have a primary mission of promoting 

community development; (3) be a financing entity; (4) provide 

development services along with financing activities; (5) serve one 

or more target market(s); (6) maintain accountability to its defined 

target market(s); and (7) be a non-government entity and not under 

the control of any government entity. 

13 One of the 10 CDFI Certification Application(s) was approved within the 90-day CCME review 

window. 

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According to CDFI Fund’s records, 14 of the 15 awardees14 that 

did not apply for CDFI certification and all 16 that applied but were 

declined failed to meet one or more of the following CDFI 

certification requirements: 

• did not demonstrate that it was operating as a financing 

entity at the time of certification application; 

• did not direct at least 60 percent of financial product 

activities to at least one eligible “Investment Area”15 or 

“Targeted Population;”16 and/or 

• did not maintain accountability to residents of the 

“Investment Area(s)” or “Targeted Population(s)” through 

representation on the governing board or equivalent. 

In all, CCME officials found 5 awardees in default of their 

Assistance Agreement(s), which included three awardees that did 

not apply for CDFI certification and two awardees that were 

declined. CCME officials applied remedies allowed under the 

Assistance Agreement(s) as follows: (1) banned two awardees in 

default from applying for another TA award for one year (one of 

which was required to return $9,137 of its unexpended award 

amount); and (2) banned one awardee from applying for another 

TA award for two years. The remaining two awardees were no 

longer in existence at the time they were found in default, and 

CCME sought no other action. The remaining 26 awardees were 

found non-compliant with their Assistance Agreement(s) but not in 

default. According to the Assistance Agreement(s), the CDFI Fund, 

in its sole discretion, may find an awardee in default in the event of 

failure to “observe, comply with or perform any term, covenant, 

14 One of the 15 awardees did not provide a reason for not submitting a CDFI Certification Application. 15 An Investment Area must have met “at least one of the following economic distress criteria and had 

significant unmet needs for financial products and services, or were wholly located within an 

Empowerment Zone or Enterprise Community (as designated under section 1391 of the Internal 

Revenue Code of 1986). The distress criteria are poverty rate greater than 20%, median family income 

at 80% or below applicable benchmarks, or unemployment rate 1.5 times the national average.” 16 A Targeted Population is defined as “either (1) Low Income Targeted Populations – for a specified 

geographic unit, individuals whose family income (adjusted for family size) is 80% of the metropolitan 

area median family income or the greater of 80% of the non-metropolitan area median family income or 

80% of the statewide non-Metropolitan Area median family income, or (2) Other Targeted Populations – 

for a specified geographic unit, populations that are: African-American, Hispanic, Native American, 

Native Alaskan, Native Hawaiian, Other Pacific Islander, residing in Other Pacific Islands.” 

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agreement, or other provision of the CDFI Fund regulations and the 

Assistance Agreement(s).” As such, CCME officials chose not to 

do so for the other 26 TA awardees that failed to meet their 

certification performance goal. No specific reasons were provided 

to us or documented by CCME personnel. 

According to the Government Accountability Office’s (GAO) 

Standards for Internal Control in the Federal Government17 in place 

during the FY 2006 through FY 2012 period under audit, “Internal 

control and all transactions and other significant events need to be 

clearly documented, and the documentation should be readily 

available for examination. The documentation should appear in 

management directives, administrative policies, or operating 

manuals and may be in paper or electronic form. All documentation 

and records should be properly managed and maintained.” 

Treasury Directive (TD) 80-05, Records and Information 

Management Program,

18 in effect at the time, required among other 

things, that program officials have primary responsibility to create 

and maintain those records needed to ensure adequate and proper 

documentation of their area of responsibility. TD Publication (TD P) 

80-05, Records and Information Management Manual,

19 further 

stated “All program officials shall create and maintain adequate and 

proper documentation of the program for which they are 

responsible. This means a record of the conduct of government 

business that is complete and accurate to the extent required to 

document the organization functions, policies, decisions, 

procedures, and essential transactions of their office and to protect 

the legal and financial interest of the government and of persons 

directly affected by the activities of their office.” 

During our audit, CDFI Fund management recognized that the 

certification process needed to be re-examined. To that end, the 

CDFI Fund published a Request for Information (RFI),

20 in January 

17 GAO, Standards for Internal Control in the Federal Government (GAO/AIMD-00-21.3.1; November 

1999) was superseded by Standards for Internal Control in the Federal Government (GAO-14-704G; 

September 2014) effective beginning FY 2016. 

18 Treasury, Records and Information Management (TD 80-05, June 26, 2002) was updated in Jan 

January 31, 2018. 

19 Treasury, Records and Information Management Manual (TD P 80-05; June 2002). 20 “A Proposed Rule by the Community Development Financial Institutions Fund,” Federal Register, 

January 9, 2017, www.federalregister.gov/d/2017-00013. 

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2017, seeking public comments on the criteria used to evaluate 

entities applying for CDFI certification. The purpose of the RFI was 

to review the CDFI Fund’s CDFI certification tests to ensure that 

those tests continue to meet the statutory and regulatory 

requirements of the CDFI Program along with its primary goal of 

supporting, rather than inhibiting, the growth and reach of CDFIs. 

CDFI Fund management stated that after internal review, the 

results of the RFI would be used to update its certification 

guidelines. At the time of our audit, the CDFI Fund was still 

reviewing the RFI results. As of June 2019, this internal review 

was still in progress. 

Recommendations 

We recommend that the Director of the CDFI Fund do the 

following: 

1. Consider requiring a reasonable CDFI Certification 

Application deadline in the Assistance Agreement(s) that will 

allow CCME staff sufficient review time to make certification 

decisions within the 90 calendar day timeline outlined in the 

CDFI Certification Procedures. 

Management Response 

CDFI Fund management concurred with this 

recommendation. Management noted that in FY 2017, the 

CDFI Fund added a performance goal in the Assistance 

Agreement that requires TA awardees to submit a CDFI 

Certification Application one year prior to the requirement for 

the awardee to become a certified CDFI. This enhancement, 

along with the implementation of AMIS in FY 2016, provides 

CCME staff with a standardized, automated, and transparent 

system to review certification applications and make 

certification determinations in accordance with the 

timeframes established in CCME’s policies and procedures. 

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OIG Comment 

Management’s corrective actions, if implemented as stated, 

meet the intent of our recommendation. 

2. Reassess CCME staff resources necessary to review CDFI 

Certification Application(s) and make certification decisions 

within the 90 calendar day timeline outlined in the CDFI 

Certification Procedures. 

Management Response 

CDFI Fund management concurred with this recommendation 

and noted that senior management assesses the need for 

staffing on an on-going basis subject to budget constraints. 

As discussed above, the implementation of AMIS also 

enables the CDFI Fund to monitor the status of CDFI 

Certification Applications and allocate resources to meet the 

timeframes stated in CCME’s SOPs. 

OIG Comment 

Management’s corrective actions, if implemented as stated, 

meet the intent of our recommendation. 

3. Reassess the significance given to TA awardees’ noncompliance with the CDFI certification requirement of the 

Assistance Agreement(s) when making a determination of 

default or no default since one of several goals is for a noncertified entity to build capacity and become CDFI certified. 

Management Response 

CDFI Fund management concurred with this 

recommendation. Management noted that in FY 2015, the 

CDFI Fund implemented a process to assess the severity of 

an awardee’s noncompliance when making a determination 

of default or no default. This process leverages the 

Noncompliance Memo Replacement (NCMR), a risk 

assessment tool that takes into account a series of set 

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factors, such as an awardee’s past compliance history, to 

ensure compliance determinations are made in a consistent 

manner. In FY 2018, the CDFI Fund further enhanced its 

process by increasing the level of severity given to TA 

awardees that are noncompliant with the CDFI certification 

requirement of the Assistance Agreement by finding the 

awardee in default and giving the awardee an opportunity to 

cure. 

OIG Comment 

Management’s corrective actions, if implemented as stated, 

meet the intent of our recommendation. 

4. Ensure that CCME staff fully document the reasons for 

determinations of default or no default when TA awardees’ 

are non-compliant with their Assistance Agreement(s). 

Management Response 

CDFI Fund management concurred with this 

recommendation. The response noted that, beginning in FY 

2017, CCME enhanced policies and procedures to ensure 

compliance determinations are fully documented via the 

NCMR process described above. The CCME Program 

Manager approves determinations that find awardees in 

default. CCME then communicates determinations to 

awardees via formal written notice and updates the final 

compliance statuses within AMIS to promote transparency. 

OIG Comment 

Management’s corrective actions, if implemented as stated, 

meet the intent of our recommendation. 

Finding 2 Monitoring Activities Were Not Sufficient to 

Ensure TA Awardee Compliance 

CCME’s monitoring activities were not sufficient to ensure TA 

awardees were in compliance with their Assistance Agreement(s). 

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As described in detail below, we found that CCME staff did not (1) 

follow up on TA awardees’ delinquent annual reports, (2) review 

TA awardees’ annual report submissions timely for compliance and 

final close out of TA awards after the final performance period 

ends, and (3) monitor TA awardees’ progress towards achieving 

CDFI certification. Furthermore, CDFI Fund’s CDFI Program and 

Native Initiatives Standard Operating Procedures (SOP) in place 

during FY 2006 through FY 2012 did not include procedures 

specific to addressing these control activities. 

According to the GAO Standards for Internal Control in the Federal 

Government applicable to the FY 2006 through FY 2012 period 

under audit, “management should design and implement internal 

control. Activities need to be established to monitor performance 

measures and indicators...Control activities occur at all levels and 

functions of the entity. They include a wide range of diverse 

activities such as approvals, authorizations, verifications, 

reconciliations, performance reviews, maintenance of security, and 

the creation and maintenance of related records which provide 

evidence of execution of these activities as well as appropriate 

documentation.” 

GAO’s internal control requirements, effective beginning FY 2016, 

further defined control activities as “actions management 

establishes through policies and procedures to achieve objectives 

and respond to risks in the internal control system, which includes 

the entity’s information system. Management should design control 

activities to achieve objectives and respond to risks. Management 

should design the entity’s information system and related control 

activities to achieve objectives and respond to risks. Management 

should implement control activities through policies.” 

Delinquent Annual Reports 

The Assistance Agreement(s) require awardees to submit annual 

reports during and after their respective performance periods. 

Annual reports are due 180 days after an awardee’s respective FY 

year-end, and include among the following: (1) the Financial 

Report, (2) Institution Level Report, (3) audit reports required by 

Office of Management and Budget Circular No. A-133 (if required, 

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this report is due 270 days after an awardee’s FY year-end), (4) 

Uses of TA Report, (5) Explanation of Noncompliance, and (6) 

Federal Financial Report/Standard Form 425. Annual reports are 

tracked in CDFI Fund’s Reports Monitoring System (RMS) and 

CCME staff review reports to verify awardee compliance with their 

Assistance Agreement(s). 

Additionally, the CDFI Fund’s SOP for the period FY 2006 through 

FY 2012 did not provide for consistent and timely follow up by 

CCME on awardees’ delinquent annual reports. From FY 2006 

through FY 2008, the SOP did not specify a timeline for CCME 

staff to follow up on delinquent annual reports. Between FY 2009 

and FY 2010, the SOP was modified to require follow up on 

delinquent annual reports within 30 days. The criteria for follow up 

on late reporting was removed from the SOP in FY 2011, and then 

reinstituted in FY 2012 at 45 days. When the SOP did specify a 

timeline for follow-up, awardee notification of delinquent reports 

was “subject to sufficient CCME staffing resources.” Although not 

within the scope of this audit, we noted that the CDFI Fund’s FY 

2017 SOP require CCME staff to send reporting reminders to 

awardees in advance of reporting deadlines. Additionally, CCME 

staff are to identify any delinquent annual reports and notify 

awardees that they have 10 business days to submit overdue 

reports to avoid default procedures. However, the SOP did not 

specify a deadline for CCME staff to identify delinquencies and 

notify awardees. 

We reviewed RMS for the annual report submissions of the 75 

sampled TA awardees and found that CCME staff did not follow-up 

timely or at all on 141 delinquent annual reports of the 926 total 

reports due. That is, CCME staff took between 46 and 827 days to 

follow up on 108 delinquent reports and did not follow-up at all on 

the remaining 33 delinquencies. 

CCME staff told us that consistent and timely follow-up was 

difficult because RMS did not automatically notify them of 

delinquent reports, thereby requiring awardee files to be researched 

individually. Additionally, RMS did not keep a historical record of all 

dates that CCME staff made changes to awardee annual reports 

and only captured the date of the most recent updates. For 

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example, if an awardee submitted an annual report on time that 

was rejected by CCME staff, the report’s resubmission date would 

be the latest record in RMS. As such, an annual report that was 

submitted on time could reflect a delinquency in RMS. To preserve 

the initial submission date, CCME staff would have to manually 

change the report date in RMS or make notes in the awardee's file 

to give credit for timely report submission. CCME’s Associate 

Program Manager also stated that many of these issues would be 

resolved with the implementation of AMIS.21 

Annual Report Reviews and Award Closeouts 

The CDFI Fund’s SOP for FY 2006 through FY 2012 did not 

specify a timeline for initializing a review of awardees’ annual 

reports and making a compliance determination based on the 

review. We found that, in many cases, CCME took a significant 

amount of time to initiate reviews of annual reports submitted by 

TA awardees in our sample. Specifically, CCME staff did not 

initiate reviews of 365 of the 926 annual reports (or 39 percent) 

due until 91 days after receipt. Review of 59 of the 365 annual 

reports (or 16 percent) did not begin for at least one year after 

receipt. 

Without timely review of annual reports, CCME staff were unable 

to make timely determinations of TA awardees’ compliance with 

their Assistance Agreement(s). Compliance determinations impact 

an awardee’s ability to receive future awards for both TA and other 

financial assistance under the CDFI Program. 

Similarly, compliance reviews are part of the award closeout 

process. In our sample of 75 TA awards, the CCME staff closed 

out 56 awards within one year after receipt of all required final 

reports. However, 17 were closed out between 51 and 1,729 days 

21 AMIS was not fully operational within the period of the audit scope. While the application submission 

module became fully operational in April 2017, the reporting module was not. As such, AMIS was not 

tested as part of this audit. According to the CDFI Fund’s updated SOPs [April 19, 2017], “Report 

Review Policies and Procedures for CDFI Program Awards in AMIS,” AMIS will allow awardee portfolios 

to be managed fully electronically and will have the ability to automatically notify awardees of 

delinquent reports. 

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beyond the one-year period after the final annual report was due 

and 2 awards remained open at the conclusion of our audit.

22 

The CDFI Fund’s SOPs in effect from FY 2006 through FY 2012 

did not specify a timeline for award closeout after the conclusion of 

an awardee's period of performance. Moreover, the SOPs stated 

that “staff resource limitations at the CDFI Fund do not permit the 

(closeout process) to be conducted routinely, as it should be, for 

each award made under this program.” 

In April 2017, CDFI Fund updated its SOP that requires CCME to 

make a compliance determination within 60 days of receipt of a 

complete annual report submitted by the required deadline or within 

90 days of receipt of a complete annual report submitted earlier 

than the required deadline. Furthermore, the SOP was updated to 

require that awards “be closed out within 90 days of the last 

performance period due date” to reflect OMB’s Uniform 

Administrative Requirements, Cost Principles, and Audit 

Requirements for Federal Awards (Uniform Guidance). 

23 

Monitoring Progress Toward CDFI Certification 

As noted in the finding above, 39 percent of all non-certified TA 

awardees did not achieve certification during their performance 

periods as required by their respective Assistance Agreement(s). 

The CDFI Fund‘s SOP for FY 2006 through FY 2012 did not require 

monitoring of TA awardees’ progress toward achieving CDFI 

certification. Furthermore, the Assistance Agreement(s) did not 

require TA awardees to submit data demonstrating progress toward 

certification goals. 

According to CCME staff, CDFI certification progress was not 

evaluated until after the end of the performance period to allow TA 

22 One of the two awardees not closed out at the time of our audit submitted its final report in June of 

2014 while the other was found non-compliant for not submitting its final report (which was due in 

September 2014). 

23 2 CFR part 200.343, Closeout, section (g), “...the Federal awarding agency or pass-through entity 

should complete all closeout actions for Federal awards no later than one year after receipt and 

acceptance of all required final reports.” Uniform Guidance became applicable for Federal awards made 

after December 25, 2014, and therefore, was not applicable for Federal awards in our sample. 

Improvements Are Needed in CDFI Fund’s Administration of Page 18 

Technical Assistance Awards (OIG-20-037) 
 

 

 

 

 

 

 

awardees the full performance period to utilize their awards. 

However, early monitoring of progress is critical to early detection 

of issues preventing CDFI certification and to ensure the proper use 

of awards. As noted above, GAO’s Standards for Internal Control 

state that management should design control activities to achieve 

objectives and respond to risks, including activities to monitor 

performance measures and indicators. Documenting such 

monitoring control activities is a tenet of internal control as 

described in GAO’s Standards for Internal Control. 

Recommendations 

We recommend that the Director of the CDFI Fund do the 

following: 

5. Establish in SOPs a reasonable timeline for follow up on TA 

awardees’ delinquent annual reports. 

Management Response 

CDFI Fund management concurred with this 

recommendation. Management noted that, beginning in FY 

2017, the CDFI Fund operationalized compliance SOPs 

within AMIS to enable CCME to follow up on delinquent 

annual reports in a reasonable timeframe. Additionally, 

CCME implemented system requirements in AMIS that send 

automated report due date reminders and overdue report 

notices to awardees. These enhancements help reduce the 

number of delinquent reports and expedite follow up. 

OIG Comment 

Management’s corrective actions, if implemented as stated, 

meet the intent of our recommendation. That said, we 

encourage management to update its compliance SOPs to 

incorporate additional timeframes for CCME staff to follow 

up directly with recipients on reports that remain delinquent 

after receiving AMIS notifications. 

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Technical Assistance Awards (OIG-20-037) 
 

 

 

 

6. Reassess information technology capabilities to determine if 

system users can be automatically alerted of delinquent 

reports. 

Management Response 

CDFI Fund management concurred with this 

recommendation. Management noted that, beginning in FY 

2017, the CDFI Fund implemented system requirements in 

AMIS that send automated report due date reminders and 

overdue report notices to awardees. Additionally, AMIS 

contains all report submission deadlines, actual report 

submission dates, and report review statuses. 

OIG Comment 

Management’s corrective actions, if implemented as stated, 

meet the intent of our recommendation. 

7. Assess CCME staffing levels to ensure sufficient compliance 

monitoring is performed for making awardee compliance 

determinations and closing out awards within the timelines 

established in the updated SOP. 

Management Response 

CDFI Fund management concurred with this recommendation 

and noted that senior management assesses the need for 

staffing on an on-going basis subject to budget constraints. 

Similar to CDFI Certification, the implementation of AMIS 

beginning in FY 2016 automated CDFI compliance 

monitoring practices. This contributed to improving CCME 

staff efficiency in making compliance determinations within 

timelines established in SOPs. AMIS provides reports on 

status of compliance monitoring to assist management in 

allocating staff resources to meet established timelines. 

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OIG Comment 

Management’s corrective actions, if implemented as stated, 

meet the intent of our recommendation. 

8. Ensure the closeout of all 315 TA awards within the FY 

2006 through FY 2012 scope of this report. 

Management Response 

CDFI Fund management concurred with this recommendation 

and noted that all 315 TA awards within the FY 2006 

through FY 2012 scope of this audit report are closed out. 

OIG Comment 

Management’s corrective action, if implemented as stated, 

meets the intent of our recommendation. 

9. Establish and implement procedures that require monitoring 

of TA awardees’ progress toward meeting CDFI certification 

requirements prior to submitting a CDFI Certification 

Application. 

Management Response 

CDFI Fund management concurred with this 

recommendation. Management noted that in FY 2017, the 

CDFI Fund added a performance goal in the Assistance 

Agreement that requires recipients to submit a CDFI 

Certification Application one year prior to the requirement for 

the recipient to become a certified CDFI. Further, awardee 

progress towards meeting the CDFI certification requirement 

is actively monitored in AMIS. Management further 

responded that CCME is also proactively pursuing other 

mechanisms to ensure awardees meet the CDFI certification 

requirement. CCME worked with the CDFI/NACA [Native 

American CDFI Fund Assistance] Program Team to align the 

CDFI/NACA Application with the certification policy to assist 

the CDFI/NACA Program team in assessing an applicant’s 

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ability to successfully meet the certification requirement. 

CCME also conducts monthly certification conference calls 

to provide technical assistance to organizations seeking 

certification as a CDFI. 

OIG Comment 

Management’s corrective actions, if implemented as stated, 

meet the intent of our recommendation. 

* * * * * * 

We appreciate the cooperation and courtesies extended to our staff 

during the audit. Major contributors to this report are listed in appendix 3. 

A distribution list for this report is provided as appendix 4. If you have 

any questions, you may contact me at (202) 927-5784 or Nick Slonka, 

Audit Manager at (202) 927-8772. 

/s/ 

Donna Joseph 

Deputy Assistant Inspector General for Audit 

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Appendix 1 

Objectives, Scope, and Methodology 

In December 2014, we initiated an audit of the Community 

Development Financial Institutions (CDFI) Fund’s administration of 

its Technical Assistance (TA) awards. The objective of our audit 

was to determine whether awardees met the CDFI Fund’s 

certification requirements as outlined in their TA Assistance 

Agreements. As part of our audit, we also assessed CDFI Fund’s 

monitoring activities for ensuring awardees’ compliance. 

The scope of our audit comprised TA awards made by the CDFI 

Fund under the CDFI Program from fiscal years (FY) 2006 through 

FY 2012 with exception of TA awards made under the Native 

American Initiative Program. This comprised a population of 315 

TA awards totaling $26,862,063 of awarded funds. Of this 

amount, $17,523,746 was awarded to 210 of the 315 awardees 

that had already achieved certification at the time of award. 

Therefore, these awardees were excluded from our testing of CDFI 

certification. To determine whether awardees met CDFI 

certification requirements in accordance with their Assistance 

Agreement, we tested all 105 non-certified awardees (or 100 

percent) with awards totaling $9,338,317. 

To assess the CDFI Fund’s monitoring activities for ensuring 

awardees’ compliance with their Assistance Agreement(s), we 

statistically selected a random sample of 75 of the 315 TA awards, 

totaling $6,702,518 (or 25 percent) of award amounts. The 

selection was based on a 90 percent confidence level with +/- 5 

percent precision and a 10 percent expected error rate. This 

representative sample was tested to assess compliance monitoring 

activities specific to the review of CDFI Certification Application(s), 

annual reporting requirements, and award close out. Specifically, 

we are confident that the results of our testing of the following 

control attributes for our sample were accurate and support our 

overall conclusion that the CDFI Fund’s monitoring activities were 

insufficient as described in finding 2: 

• 78.7 percent of awardees with 767 annual reports due 

were delinquent (sampling error of +/- 7.1 percent); 

• 44.0 percent of awardees with 108 delinquent annual 

reports were not notified by the CDFI Fund within the 45 

day follow up window (sampling error of +/- 8.6 percent); 

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Technical Assistance Awards (OIG-20-037) 
 

 

 

 

 

 

 

 

 

 

 

Appendix 1 

Objectives, Scope, and Methodology 

• 13.3 percent of awardees with 33 of delinquent annual 

reports were never notified by the CDFI Fund (sampling 

error of +/- 6.0 percent); 

• 70.7 percent of awardees with 891 annual reports 

submitted were not reviewed timely (i.e. 90 days of receipt) 

(sampling error of +/- 7.9 percent); and 

• 25.3 percent of awardees with 245 annual reports due 

were not reviewed for timely award closeout (sampling error 

of +/- 7.6 percent). 

To meet our audit objectives, we performed the following steps: 

• Reviewed applicable laws, regulations, operating policies and 

procedures, audit reports, and other supporting 

documentation, to include: 

o Riegle Community Development and Regulatory 

Improvement Act of 1994; 

o Office of Management and Budget’s (OMB) Circular 

No. A-110, Uniform Administrative Requirements for 

Grants and Agreements With Institutions of Higher 

Education, Hospitals, and Other Non-Profit 

Organizations (November 1993, as further amended 

September 1999); 

o OMB’s Uniform Administrative Requirements, Cost 

Principles, and Audit Requirements for Federal Awards 

(December 2014); 

o OMB Circular No. A-133, Audits of States, Local 

Governments, and Non-Profit Organizations and the 

OMB Circular No. A-133 “Compliance Supplement”; 

o Government Accountability Office’s (GAO) Standards 

for Internal Control in the Federal Government 

(GAO/AIMD-00-21.3.1; November 1999) superseded 

by Standards for Internal Control in the Federal 

Government (GAO-14-704G; September 2014); 

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Appendix 1 

Objectives, Scope, and Methodology 

o Department of the Treasury (Treasury) Directive (TD) 

80-05, Records and Information Management Program, 

(June 26, 2002) superseded by TD 80-05, Records 

and Information Management Program (January 31, 

2018); 

o Treasury, Records and Information Management 

Manual (TD Publication 80-5; June 2002); 

o CDFI Fund’s Community Development Financial 

Institutions Program and Native Initiatives Standard 

Operating Procedures for FY 2006 through FY 2014; 

o CDFI Fund’s Compliance Monitoring and Evaluation 

Unit: Report Review Policies and Procedures for CDFI 

Program Awards in AMIS (effective 2017); 

o Notice of Funds Availability Inviting Applications for 

the Community Development Financial Institutions 

Program for FY 2006 through FY 2012 funding rounds; 

o CDFI Program Award Books for FY 2006 through FY 

2012; 

o Lists of Certified CDFIs, FY 2008 through FY 2014; 

o TA awardees’ Assistance Agreements and award files; 

o documentation pertaining to the CDFI Fund’s 

compliance monitoring duties, including awardee 

Annual Reports and files, Reports Monitoring System 

(RMS) screenshots, Noncompliance Memo 

Replacement forms, MyCDFI system certification data, 

findings of default letters, and explanations of noncompliance; and 

o correspondence between CDFI Fund and awardees. 

• Interviewed officials and key personnel within the CDFI 

Fund’s organizational units, to include (1) CDFI Program, (2) 

Financial Strategies and Research, and (3) Certification, 

Compliance, Monitoring and Evaluation. 

• Reviewed RMS for dates and internal notes, Lists of Certified 

CDFIs, CCME’s compliance determinations, and certification 

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Appendix 1 

Objectives, Scope, and Methodology 

review documentation and compared the RMS data to 

requirements in awardees’ Assistance Agreements and CDFI 

Fund’s SOPs. 

We performed our fieldwork at the CDFI Fund and the Office of 

Inspector General in Washington, D.C., from December 2014 

through June 2019. 

We conducted this performance audit in accordance with generally 

accepted government auditing standards. Those standards require 

that we plan and perform the audit to obtain sufficient, appropriate 

evidence to provide a reasonable basis for our findings and 

conclusions based on our audit objectives. We believe that the 

evidence obtained provides a reasonable basis for our findings and 

conclusions based on our audit objectives. 

Improvements Are Needed in CDFI Fund’s Administration of Page 26 

Technical Assistance Awards (OIG-20-037) 
 

29, 2020 

Ms. Donna Joseph 

DEPARTMENT OF THE TREASURY 

COMMUNITY DEVELOPMENT FINANCIAL INSTITUTIONS FUND 

1500 PENNSYLVANIA AVENUE, NW 

WASHINGTON , D.C. 20220 

Deputy Assistant Inspector General for Audit 

Office of the Inspector General 

U.S. Department of the Treasury 

1500 Pennsylvania Ave., N. W. 

Washington, D.C. 20220 

RE: CDFI Fund Management Response to Recommendations in Audit Report - Improvements 

Are Needed in CDFI Fund's Administration of Technical Assistance 

Dear Ms. Joseph, 

Thank you for the opportunity to review and comment on the Office of the Inspector General' s 

(OIG) formal draft audit report on the Community Development Financial Institutions (CDFI) 

Fund's Technical Assistance (TA) awards made from fiscal year (FY) 2006 through FY 2012. The 

objective of the audit was to determine whether awardees met the CDFI Fund's certification 

requirement as outlined in their TA Assistance Agreement(s). While the audit review process 

was being conducted, the CDFI Fund proactively implemented improvements to the 

administration of TA awards and related information technology systems that address the OIG 

recommendations, as detailed in our responses below. Below is the CDFI Fund management 

response to the OIG recommendations listed in the audit report - Improvements Are Needed in 

CDFI Fund's Administration of Technical Assistance. 

OIG Recommendation 1 

Consider requiring a reasonable CDFI Certification Application deadline in the Assistance 

Agreement(s) that will allow CCM E staff sufficient review time to make certification decisions 

within the 90 calendar day timeline outlined in the CDFI Certification Procedures. 

Appendix 2 

CDFI Fund Management Response 

Improvements Are Needed in CDFI Fund’s Administration of Page 27 

Technical Assistance Awards (OIG-20-037) 
 

 

Response 

The CDFI Fund concurs with this recommendation. In FY 2017, the CDFI Fund added a 

performance goal in the Assistance Agreement that requires Technical Assistance (TA) 

Awardees to submit a CDFI Certification Application one year prior to the requirement for the 

Awardee to become a certified CDFI. This enhancement, along with the implementation of 

the Award Management Information System (AMIS) in FY 2016, which provides the CDFI Fund 

with a standardized, automated, and transparent system, allows Certification, Compliance 

Monitoring and Evaluation (CCME) staff to review certification applications and make 

certification determinations in accordance with the timeframes established in CCME's policies 

and procedures. 

OIG Recommendation 2 

Reassess CCME staff resources necessary to review CDFI Certification App/ication(s) and make 

certification decisions within the 90 calendar day timeline outlined in the CDFI Certification 

Procedures. 

Management Response 

The CDFI Fund concurs with this recommendation. CDFI Fund senior management assesses 

the need for staffing on an on-going basis subject to budget constraints. As discussed above, 

the implementation of AMIS also enables the CDFI Fund to monitor the status of CDFI 

Certification Applications and allocate resources to meet the timeframes stated in CCME's 

Standard Operating Procedures (SOPs). 

OIG Recommendation 3 

Reassess the significance given to TA awardees' non-compliance with the CDFI certification 

requirement of the Assistance Agreement(s) when making a determination of default or no 

default since one of several goals is for a non-certified entity to build capacity and become CDFI 

certified. 

Management Response 

The CDFI Fund concurs with this recommendation. In FY 2015, the CDFI Fund implemented a 

process to assess the severity of an awardee's noncompliance when making a determination 

of default or no default. This process leverages the Noncompliance Memo Replacement 

(NCMR), a risk assessment tool that takes into account a series of set factors, such as an 

awardee's past compliance history, to ensure compliance determinations are made in a 

consistent manner. In FY 2018, the CDFI Fund further enhanced its process by increasing the 

level of severity given to TA awardees that are noncompliant with the CDFI certification 

requirement of the Assistance Agreement by finding the awardee in default and giving the 

awardee an opportunity to cure. 

Appendix 2 

CDFI Fund Management Response 

Improvements Are Needed in CDFI Fund’s Administration of Page 28 

Technical Assistance Awards (OIG-20-037) 
 

 

Recommendation 4 

Ensure that CCME staff fully document the reasons for determinations of default or no default 

when TA awardees' are non-compliant with their Assistance Agreement(s). 

Management Response 

The CDFI Fund concurs with this recommendation. Beginning in FY 2017, CCME enhanced 

policies and procedures to ensure compliance determinations are fully documented via the 

NCMR process described above. The CCME Program Manager approves determinations that 

find awardees in default. CCME then communicates determinations to awardees via 

formal written notice and updates the final compliance statuses within AMIS to promote 

transparency. Additionally, CCME conducts annual trainings for Portfolio Managers and 

performs quality assurance reviews for completeness and consistency. 

OIG Recommendation 5 

Establish in SOPs a reasonable timeline for follow up on TA awardees' delinquent annual 

reports. 

Management Response 

The CDFI Fund concurs with this recommendation. Beginning in FY 2017, the CDFI Fund 

operationalized compliance SOPs within AMIS to enable CCME to follow up on delinquent 

annual reports in a reasonable timeframe. Additionally, CCME implemented system 

requirements in AMIS that send automated report due date reminders and overdue report 

notices to awardees. These enhancements help reduce the number of delinquent reports 

and expedite follow up. 

OIG Recommendation 6 

Reassess information technology capabilities to determine if system users can be automatically 

alerted of delinquent reports. 

Management Response 

The CDFI Fund concurs with this recommendation. Beginning in FY 2017, the CDFI Fund 

implemented system requirements in AMIS that send automated report due date reminders 

and overdue report notices to awardees. Additionally, AMIS contains all report submission 

deadlines, actual report submission dates, and report review statuses. 

OIG Recommendation 7 

Appendix 2 

CDFI Fund Management Response 

Improvements Are Needed in CDFI Fund’s Administration of Page 29 

Technical Assistance Awards (OIG-20-037) 
 

 

CCME staffing levels to ensure sufficient compliance monitoring is performed for making 

awardee compliance determinations and closing out awards within the timelines established in 

the updated SOP. 

Management Response 

The CDFI Fund concurs with this recommendation. CDFI Fund senior management assesses 

the need for staffing on an on-going basis subject to budget constraints. Similar to CDFI 

Certification, the implementation of AMIS beginning in FY 2016 automated CDFI compliance 

monitoring practices. This contributed to improving CCME staff efficiency in making 

compliance determinations within timelines established in SOPs. AMIS provides reports on 

status of compliance monitoring to assist management in allocating staff resources to meet 

established timelines. 

OIG Recommendation 8 

Ensure the closeout of all 315 TA awards within the FY 2006 through FY 2012 scope of this 

report. 

Management Response 

The CDFI Fund concurs with this recommendation. All 315 TA awards within the FY 2006 

through FY 2012 scope of this audit report are closed out. 

OIG Recommendation 9 

Establish and implement procedures that require monitoring of TA awardees' progress toward 

meeting CDFI certification requirements prior to submitting a CDFI Certification Application. 

Management Response 

The CDFI Fund concurs with this recommendation. As discussed above, in FY 2017, the CDFI 

Fund added a performance goal in the Assistance Agreement that requires Recipients to 

submit a CDFI Certification Application one year prior to the requirement for the Recipient to 

become a certified CDFI. Awardee progress towards meeting the CDFI certification 

requirement is actively monitored in AMIS. 

CCME is also proactively pursuing other mechanisms to ensure awardees meet the CDFI 

certification requirement. CCME worked with the CDFI/NACA Program Team to align the 

CDFI/NACA Application with the certification policy to assist the CDFI/NACA Program team in 

assessing an applicant's ability to successfully meet the certification requirement. CCME also 

conducts monthly certification conference calls to provide technical assistance to 

organizations seeking certification as a CDFI. 

Appendix 2 

CDFI Fund Management Response 

Improvements Are Needed in CDFI Fund’s Administration of Page 30 

Technical Assistance Awards (OIG-20-037) 
 

 

CDFI Fund appreciates all the work of your staff, and the opportunity to review and provide 

responses to the recommendations in the report. If you have any questions, please contact 

Denise Noel, Legal Counsel, at 202.653.0351 or noeld@cdfi.trea.gov. 

Sincerely, 

Director 

CDFI Fund 

Appendix 2 

CDFI Fund Management Response 

Improvements Are Needed in CDFI Fund’s Administration of Page 31 

Technical Assistance Awards (OIG-20-037) 
 

Appendix 3 

Major Contributors to This Report 

Nick Slonka, Audit Manager 

Kirk Solomon, Auditor 

Herb Addy, Referencer 

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Technical Assistance Awards (OIG-20-037) 
 

 

 

 

 

 

 

 

Appendix 4 

Report Distribution 

Department of the Treasury 

Secretary 

Deputy Secretary 

Under Secretary for Domestic Finance 

Assistant Secretary for Financial Institutions 

Deputy Assistant Secretary for Community and Economic 

 Development 

Office of Strategic Planning and Performance Improvement 

Office of the Deputy Chief Financial Officer, Risk and Control 

Group 

Community Development Financial Institutions Fund 

Director 

Deputy Director 

Office of Management and Budget 

OIG Budget Examiner 

United States Senate 

Committee on Banking, Housing, and Urban Affairs 

Committee on Finance 

Committee on Homeland Security and Governmental Affairs 

United States House of Representatives 

Committee on Oversight and Reform

 Financial Services Committee 

Improvements Are Needed in CDFI Fund’s Administration of Page 33 

Technical Assistance Awards (OIG-20-037) 
Treasury OIG Website

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