Audit 17758

Program Affected AL Number 21.027 Coronavirus State and Local Fiscal Recovery Funds, passed through the Maine Department of Economic and Community Development, agreement period February 28, 2022 - June 30, 2023. Criteria Required by 2 CFR, Part 200 for federally funded programs, when an institution enters into a covered transaction with an entity or individual, the institution must verify that the vendor is not suspended or debarred or otherwise excluded from participating in federal programs. Generally, a covered transaction is a transaction expected to equal or exceed $25,000 and be funded with federal dollars. This verification may be accomplished by checking the System for Award Management (SAM), or by adding a clause or condition to the covered transaction. Condition and Context During our testing, we noted management did not review the SAM for beneficiaries meeting the covered transaction threshold prior to disbursing funding. Our nonstatistical sample of 40 transactions included 18 transactions equal to or exceeding $25,000. We understand the SAM was checked after the transactions were completed. Questioned Costs N/A Cause and Effect The Institute was unaware of the requirement to verify beneficiaries. Since this process was not performed, there is a greater risk of beneficiaries that are included on the SAM being disbursed funds through federal funds. Repeat Finding? No Recommendation We recommend that the Institute establish and follow a policy to confirm funds are not provided to those suspended or debarred in advance of the completed transaction. Views of Responsible Officials and Planned Corrective Actions Management agrees with the finding. See attached Planned Corrective Actions.

Program Affected AL Number 21.027 Coronavirus State and Local Fiscal Recovery Funds, passed through the Maine Department of Economic and Community Development, agreement period February 28, 2022 - June 30, 2023. Criteria Required by 2 CFR, Part 200 for federally funded programs, when an institution enters into a covered transaction with an entity or individual, the institution must verify that the vendor is not suspended or debarred or otherwise excluded from participating in federal programs. Generally, a covered transaction is a transaction expected to equal or exceed $25,000 and be funded with federal dollars. This verification may be accomplished by checking the System for Award Management (SAM), or by adding a clause or condition to the covered transaction. Condition and Context During our testing, we noted management did not review the SAM for beneficiaries meeting the covered transaction threshold prior to disbursing funding. Our nonstatistical sample of 40 transactions included 18 transactions equal to or exceeding $25,000. We understand the SAM was checked after the transactions were completed. Questioned Costs N/A Cause and Effect The Institute was unaware of the requirement to verify beneficiaries. Since this process was not performed, there is a greater risk of beneficiaries that are included on the SAM being disbursed funds through federal funds. Repeat Finding? No Recommendation We recommend that the Institute establish and follow a policy to confirm funds are not provided to those suspended or debarred in advance of the completed transaction. Views of Responsible Officials and Planned Corrective Actions Management agrees with the finding. See attached Planned Corrective Actions.