Performance Audit on Selected Awards to North Carolina Arts Council

We conducted a performance audit of the North Carolina Arts Council (NCAC) for the period of October 1, 2016 through September 30, 2019. Based on our performance audit, we concluded that NCAC generally complied with financial management system and recordkeeping requirements established by the Office of Management and Budget and the National Endowment for the Arts. However, we identified the following areas requiring improvement. NCAC: reported unallowable subaward costs on its Federal Financial Report; did not maintain current policies and procedures for subawards; did not have debarment and suspension policies and procedures; and did not have policies and procedures for the management of Federal awards.