Performance Audit of the Michigan Arts and Culture Council

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Date Issued

Monday, August 18, 2025

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

Questioned Costs

$12,487,474

Funds for Better Use

Report updated under NDAA 5274

External Entity

Michigan Arts and Culture Council

Open Recommendations

This report has 4 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.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.