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Report File
Date Issued
Submitting OIG
National Endowment for the Arts OIG
Agencies Reviewed/Investigated
National Endowment for the Arts
Report Number
OIG-25-02
Report Description

We conducted a performance audit of the Michigan Arts and Culture Council (Council) for the period of October 1, 2020 through September 30, 2023.  Based on our review, we determined the Council met program requirements for each award and generally complied with award criteria.  However, we identified opportunities for improvement in the Council’s subawarding and award management procedures and controls, and issues with select subrecipient costs.  We provided 12 recommendations to address the report findings – five to the Council and seven to the Arts Endowment.  We believe these recommendations, if implemented, will help ensure the Council meets Federal and Arts Endowment requirements and better manages its awards.

Report Type
Audit
Agency Wide
Yes
Number of Recommendations
12
Questioned Costs
$12,487,474
Funds for Better Use
$0
Report updated under NDAA 5274
No
External Entity
Michigan Arts and Culture Council

Open Recommendations

This report has 12 open recommendations.
Recommendation Number Significant Recommendation Recommended Questioned Costs Recommended Funds for Better Use Additional Details
MACC.1 Yes $0 $0 This recommendation is related to recommendations MACC.2, NEA.1, and NEA.2

We recommend the Council document and implement FFR reporting procedures that adhere to cost allowability restrictions prohibiting state agencies from reporting subrecipient cost shares as their own cost share (General Terms #13), or reporting the same costs across multiple awards (2 CFR 200.403).

MACC.2 Yes $0 $0 This finding is related to recommendations MACC.1, NEA.1, and NEA.2.

We recommend the Council establish controls over its FFR reporting procedures that ensure the procedures were followed and report costs are allowable.

MACC.3 Yes $0 $0 This recommendation is related to recommendations NEA.4 and NEA.5

We recommend the Council works with its subrecipient to ensure understanding of, and compliance with, Poetry Out Loud (POL) regulations and requirements.

MACC.4 Yes $0 $0 This recommendation is related to recommendation MACC.5

We recommend the Council update its contract template to include the total amount of that Arts Endowment award's funds issued to the subrecipient to date, and the total amount of Arts Endowment funds issued to the subrecipient from all active Arts Endowment awards (2 CFR 200.332(b)(1)(viii) & (ix)).

MACC.5 Yes $0 $0 This recommendation is related to recommendation MACC.4

We recommend the Council document subrecipient notification procedures that adhere to the requirements established in 2 CFR 200.332(b)1, and establish controls that ensure the procedures are followed.

NEA.1 Yes $5,894,428 $0 This recommendation is related to recommendations MACC.1 and NEA.2

We recommend the NEA disallow $5,894,428 of unallowable subrecipient cost share from the 2019 Award.

NEA.2 Yes $6,566,008 $0 This recommendation is related to recommendations MACC.1 and NEA.1

We recommend the NEA disallow $6,566,008 of duplicate costs - $5,673 from the 2020 Award and $892,400 from the 2021 Award.

NEA.3 Yes $16,175 $0

We recommend the NEA disallow $16,175 in unsupported costs - $500 from the 2019 Award and $15,675 from the 2021 Award.

NEA.4 Yes $0 $0 This recommendation is related to recommendation NEA.5

We recommend the NEA review any additional Poetry Out Loud costs provided by the Council and determine allowability.

NEA.5 Yes $7,206 $0 This finding is related to recommendations MACC.3 and NEA.4

We recommend the NEA disallow $7,206 in unallowable Poetry Out Loud cash prize and reception costs - $3,600 from the 2020 Award and $3,606 from the 2021 Award.

NEA.6 Yes $3,154 $0

We recommend the NEA disallow $3,154 in pre-award subrecipient costs from the 2019 Award.

NEA.7 Yes $503 $0

We recommend the NEA disallow $503 in unreasonable subrecipient costs from the 2019 Award.

National Endowment for the Arts OIG

United States