U.S. Department of State Fiscal Year 2020 Agency Financial Report

G rants P rograms offers reporting capabilities to help identify awards awaiting closeout. Additionally, the Department utilizes the Department of the Interior to negotiate indirect cost rates, which facilitates timelier award closeout. The Department’s publication of a Federal assistance Human Capital Plan has resulted in increased training and guidance on Federal assistance management, including closeout requirements and procedures. In March 2020, the Office of Inspector General (OIG) conducted the risk assessment of the agency’s grant closeout process and concluded the risk associated with the Department’s grant closeout process is “low” in the OIG’s Information Report: Risk Assessment of the Department of State Grant and Cooperative Agreement Closeout Process (AUD-CGI-20-25). The “Expired Federal Grants and Cooperative Agreements Summary“ table shows the 878 awards totaling $45,073,045 for which closeout has not yet occurred, but for which the period of performance has elapsed by two years or more prior to September 30, 2020. EXPIRED FEDERAL GRANTS AND COOPERATIVE AGREEMENTS SUMMARY Category 2-3 Years 3-5 Years More than 5 Years Number of Grants/Cooperative Agreements with Zero Dollar Balances 154 209 22 Number of Grants/Cooperative Agreements with Undisbursed Balances 264 200 29 Total Amount of Undisbursed Balances $19,937,926 $22,641,474 $2,493,645 The Department understands the importance of timely closeout of grants and cooperative agreements to promote the financial accountability of grants programs. The Department continues to strengthen enforcement of the closeout requirements across domestic bureaus and overseas posts. Use of a standardized Federal assistance management system (State Assistance Management System (SAMS)), coupled with updates to Department Federal assistance policies, has enabled the Department to better monitor, analyze, and report on the closeout of awards. However, the Department still faces challenges in efficiently closing awards in a timely manner. While data passes electronically between SAMS, the Department’s financial systems, and the Health and Human Services Payment Management System (PMS), some critical closeout tasks remain a manual process in the payment system. The manual steps required to reconcile differences between systems can be labor-intensive, especially in PMS, and the Department has taken numerous steps to mitigate and resolve these issues. SAMS requires the use of a standardized closeout checklist and 144 | U ni ted S tates D epartment of S tate 2020 A gency F inanci al R eport OTHER INFORMATION | PAYMENT INTEGRITY AND OTHER LAWS AND REGULATIONS