Audit 371744

Finding 2024-001 Type of Finding – Significant Deficiency in Internal Control Over Compliance, Other Matter Federal Agency – U.S. Department of the Treasury Grant Program/Award – COVID-19 Coronavirus State and Local Fiscal Recovery Funds (CSLFRF), ALN No. 21.027 Compliance Requirement – Suspension and Debarment Repeat Finding – Yes, Finding 2023-001 Condition – During our testing of two covered transactions, we noted that management provided supporting documentation that suspension and debarment procedures were performed after the start of the procurement contracts. Questioned Costs – None, our testing revealed the vendor and subrecipient were not suspended or debarred. Criteria – 2 CFR 180.300 prohibits entities from contracting under covered transactions to parties that are suspended or debarred from doing business with the federal government. A contract for goods or services is a covered transaction if awarded as a grant or payment for specified use and if the amount of the contract is expected to equal or exceed $25,000. In order to comply with federal suspension and debarment requirements, the County can perform a search in the federal System of Award Management (SAM) website, which tracks the entities that the federal government has determined are ineligible to receive federal funding; collect a certification from the entity; or add a clause or condition to the contract. Context – For one vendor (out of two) and one subrecipient (out of three) tested for suspension and debarment, the contract agreement was signed before the suspension and debarment check was completed. Cause – There was a lack of personnel within the finance department of the County and grants administration was missing supervision by key personnel. The finding indicates that there should be process improvements in how contracts are reviewed, documented and maintained to provide evidence the compliance requirements are being met. Effect – The County could enter into a federally-funded contract with a suspended or debarred party. Recommendation – We recommend that the County either obtain certifications from vendors and subrecipients stating their organization is not suspended, debarred, or otherwise excluded from participation in federal assistance programs or document the procedures performed to verify the vendor or beneficiary is not identified as suspended or debarred on the SAM website prior to signing a contract. We recommend that the County has proper procedures in place to ensure that all contractual documentation is maintained and able to be located. We understand that the County has followed up with all vendors/subrecipients that were missing without an active registration and completed the certification form.