| This policy ensures a subaward is used for authorized purposes and performance goals are achieved in compliance with requirements set forth in the federal Office of Management and Budget (OMB) Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (“Uniform Guidance”) and Los Angeles County Board of Supervisors Policy. (2 CFR § 200; LAC BOS Policy 5.040)
This policy minimizes Los Angeles County Department of Mental Health’s (DMH/Department) risk of non-compliance with grant requirements.
This policy reviews compliance with fiscal regulations that may not be addressed during independent audits.
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| Risk: An observable event or action that can have a material effect on the reputation, financial, operational, or strategic performance of the organization.
Risk Assessment: A means of determining an organization’s compliance risk distinct from program risk. It is prospective in nature and considers exposures that are strategic, operational, financial, and legal in nature.
Risk Rating Level: A complete score for each item listed as a risk area. This score shall be used to prioritize the risk areas from highest to lowest risk.
Pass-Through Entity: A non-federal entity that provides a subaward to a subrecipient to carry out part of a federal program. (2 CFR § 200.74)
Subrecipient: A non-federal entity that receives a subaward from a pass-through entity to carry out part of a federal program, but does not include an individual that is a beneficiary of such program. A subrecipient may also be a recipient of other federal awards directly from a federal awarding agency. (2 CFR § 200.93)
Subaward: An award provided by a pass-through entity to a subrecipient for the subrecipient to carry out part of a federal award received by the pass-through entity. It does not include payments to a contractor or payments to an individual that is a beneficiary of a federal program. A subaward may be provided through any form of legal agreement, including an agreement that the pass-through entity considers a contract. (2 CFR § 200.92)
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| DMH, a pass-through entity, is responsible for making case-by-case determinations of the levels of risk regardless of the subrecipient’s contract amount.
DMH Compliance, Privacy, and Audit Services is responsible for conducting the annual risk assessments and making (or collaborating with DMH Contract Management) risk based monitoring plans for all subrecipients with federal grants. Based on the risk assessment results, subrecipients are evaluated as higher or lower risk to determine the need for closer monitoring.
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