Finding 2022-001 Significant Deficiency: Reporting - Compliance and Control Finding
ALN 11.307 – Economic Development Cluster
Federal Agency: U.S. Department of Commerce
Pass-Through Entity: N/A - Direct Award
Criteria Or Specific Requirement: The agreement for the federal award requiresseveral reports be submitted, including a Progress Report that is due within 30 days of the report period end.
Condition: The Organization did not submit the required Progress Report by the required due date.
Cause: The Organization’s internal control in place (review of reports by a supervisory employee) failed to ensure that the Progress Report was submitted by the applicable deadline.
Effect: The Progress Report was not submitted by the applicable deadline.
Context: Of the six reports selected for testing, one report was not submitted by the applicable deadline. The report was submitted 7 days after the deadline.
Questioned Costs: None.
Identification As A Repeat Finding: Not applicable.
Recommendation: We recommend that management evaluate their existing internal control for the review of reports, and consider enhancing it to ensure that all reports are submitted by applicable deadlines.
Views Of Responsible Officials: With the subsequent establishment of the dedicated Grants Coordinator position, improved controls came into place: 1) dual supervisory review of reports between the direct supervisor of the Grants Coordinator position and the legacy supervisory role of the Senior Vice President Programs; 2) a clearer timeline of reporting was established with project management systems and document repositories with additional reminders in place to ensure adequate notice is provided to individuals responsible for providing information; and 3) there is a structured follow-up process, at periodic intervals, for report review to ensure deadlines are met.
Finding 2022-002 Significant Deficiency: Procurement and Suspension and Debarment – Compliance and Control Finding
ALN 11.020 – Economic Development Administration
Federal Agency: U.S. Department of Commerce
Pass-Through Entity: N/A - Direct Award
Criteria Or Specific Requirement: The Uniform Guidance requires the Organization to adhere to federal procurement requirements when expending federal funds under the project. The Organization also must adhere to federal requirements to ensure that its contractors have not been suspended or debarred from receiving federal funds.
Condition: The Organization procured services with one vendor in an amount in excess of the $10,000 micropurchase threshold where the procurement process was not followed. Additionally, the Organization did not ensure that its contractors have not been suspended or debarred from receiving federal funds by either including appropriate language to this effect within the contract or determining that the contractors were not included within the suspension and debarment listing within the EPLS database.
Cause: The Organization’s internal control in place (review of reports by a supervisory employee) failed to ensure that procurement and suspension and debarment procedures were followed.
Effect: The Organization could contract with a contractor who is either not the most qualified and/or lowest cost provider, or who is suspended or debarred.
Context: Of three contracts selected for procurement testing, one contract had not gone through the procurement process. Additionally, none of the three contracts had been subjected to procedures to ensure the contractor was not suspended or debarred.
Questioned Costs: None.
Identification As A Repeat Finding: Not applicable.
Recommendation: We recommend that management evaluate their existing internal control for the review of reports, and consider enhancing it to ensure that all reports are submitted by applicable deadlines.
Views Of Responsible Officials: Along with strengthening of reporting, the hiring of the dedicated Grants Coordinator position additionally improved controls related to procurement. Updated internal forms to document purchasing and classify procurement requirements were established and integrated with project management tools; new procurement templates were established; and improved repositories for cataloguing procurement materials and invoices were established. Additionally, moving forward, the suspension and disbarment language will now be included specifically in all contracts and has been added into the contract template.
Finding 2022-002 Significant Deficiency: Procurement and Suspension and Debarment – Compliance and Control Finding
ALN 11.020 – Economic Development Administration
Federal Agency: U.S. Department of Commerce
Pass-Through Entity: N/A - Direct Award
Criteria Or Specific Requirement: The Uniform Guidance requires the Organization to adhere to federal procurement requirements when expending federal funds under the project. The Organization also must adhere to federal requirements to ensure that its contractors have not been suspended or debarred from receiving federal funds.
Condition: The Organization procured services with one vendor in an amount in excess of the $10,000 micropurchase threshold where the procurement process was not followed. Additionally, the Organization did not ensure that its contractors have not been suspended or debarred from receiving federal funds by either including appropriate language to this effect within the contract or determining that the contractors were not included within the suspension and debarment listing within the EPLS database.
Cause: The Organization’s internal control in place (review of reports by a supervisory employee) failed to ensure that procurement and suspension and debarment procedures were followed.
Effect: The Organization could contract with a contractor who is either not the most qualified and/or lowest cost provider, or who is suspended or debarred.
Context: Of three contracts selected for procurement testing, one contract had not gone through the procurement process. Additionally, none of the three contracts had been subjected to procedures to ensure the contractor was not suspended or debarred.
Questioned Costs: None.
Identification As A Repeat Finding: Not applicable.
Recommendation: We recommend that management evaluate their existing internal control for the review of reports, and consider enhancing it to ensure that all reports are submitted by applicable deadlines.
Views Of Responsible Officials: Along with strengthening of reporting, the hiring of the dedicated Grants Coordinator position additionally improved controls related to procurement. Updated internal forms to document purchasing and classify procurement requirements were established and integrated with project management tools; new procurement templates were established; and improved repositories for cataloguing procurement materials and invoices were established. Additionally, moving forward, the suspension and disbarment language will now be included specifically in all contracts and has been added into the contract template.
Finding 2022-001 Significant Deficiency: Reporting - Compliance and Control Finding
ALN 11.307 – Economic Development Cluster
Federal Agency: U.S. Department of Commerce
Pass-Through Entity: N/A - Direct Award
Criteria Or Specific Requirement: The agreement for the federal award requiresseveral reports be submitted, including a Progress Report that is due within 30 days of the report period end.
Condition: The Organization did not submit the required Progress Report by the required due date.
Cause: The Organization’s internal control in place (review of reports by a supervisory employee) failed to ensure that the Progress Report was submitted by the applicable deadline.
Effect: The Progress Report was not submitted by the applicable deadline.
Context: Of the six reports selected for testing, one report was not submitted by the applicable deadline. The report was submitted 7 days after the deadline.
Questioned Costs: None.
Identification As A Repeat Finding: Not applicable.
Recommendation: We recommend that management evaluate their existing internal control for the review of reports, and consider enhancing it to ensure that all reports are submitted by applicable deadlines.
Views Of Responsible Officials: With the subsequent establishment of the dedicated Grants Coordinator position, improved controls came into place: 1) dual supervisory review of reports between the direct supervisor of the Grants Coordinator position and the legacy supervisory role of the Senior Vice President Programs; 2) a clearer timeline of reporting was established with project management systems and document repositories with additional reminders in place to ensure adequate notice is provided to individuals responsible for providing information; and 3) there is a structured follow-up process, at periodic intervals, for report review to ensure deadlines are met.
Finding 2022-002 Significant Deficiency: Procurement and Suspension and Debarment – Compliance and Control Finding
ALN 11.020 – Economic Development Administration
Federal Agency: U.S. Department of Commerce
Pass-Through Entity: N/A - Direct Award
Criteria Or Specific Requirement: The Uniform Guidance requires the Organization to adhere to federal procurement requirements when expending federal funds under the project. The Organization also must adhere to federal requirements to ensure that its contractors have not been suspended or debarred from receiving federal funds.
Condition: The Organization procured services with one vendor in an amount in excess of the $10,000 micropurchase threshold where the procurement process was not followed. Additionally, the Organization did not ensure that its contractors have not been suspended or debarred from receiving federal funds by either including appropriate language to this effect within the contract or determining that the contractors were not included within the suspension and debarment listing within the EPLS database.
Cause: The Organization’s internal control in place (review of reports by a supervisory employee) failed to ensure that procurement and suspension and debarment procedures were followed.
Effect: The Organization could contract with a contractor who is either not the most qualified and/or lowest cost provider, or who is suspended or debarred.
Context: Of three contracts selected for procurement testing, one contract had not gone through the procurement process. Additionally, none of the three contracts had been subjected to procedures to ensure the contractor was not suspended or debarred.
Questioned Costs: None.
Identification As A Repeat Finding: Not applicable.
Recommendation: We recommend that management evaluate their existing internal control for the review of reports, and consider enhancing it to ensure that all reports are submitted by applicable deadlines.
Views Of Responsible Officials: Along with strengthening of reporting, the hiring of the dedicated Grants Coordinator position additionally improved controls related to procurement. Updated internal forms to document purchasing and classify procurement requirements were established and integrated with project management tools; new procurement templates were established; and improved repositories for cataloguing procurement materials and invoices were established. Additionally, moving forward, the suspension and disbarment language will now be included specifically in all contracts and has been added into the contract template.
Finding 2022-002 Significant Deficiency: Procurement and Suspension and Debarment – Compliance and Control Finding
ALN 11.020 – Economic Development Administration
Federal Agency: U.S. Department of Commerce
Pass-Through Entity: N/A - Direct Award
Criteria Or Specific Requirement: The Uniform Guidance requires the Organization to adhere to federal procurement requirements when expending federal funds under the project. The Organization also must adhere to federal requirements to ensure that its contractors have not been suspended or debarred from receiving federal funds.
Condition: The Organization procured services with one vendor in an amount in excess of the $10,000 micropurchase threshold where the procurement process was not followed. Additionally, the Organization did not ensure that its contractors have not been suspended or debarred from receiving federal funds by either including appropriate language to this effect within the contract or determining that the contractors were not included within the suspension and debarment listing within the EPLS database.
Cause: The Organization’s internal control in place (review of reports by a supervisory employee) failed to ensure that procurement and suspension and debarment procedures were followed.
Effect: The Organization could contract with a contractor who is either not the most qualified and/or lowest cost provider, or who is suspended or debarred.
Context: Of three contracts selected for procurement testing, one contract had not gone through the procurement process. Additionally, none of the three contracts had been subjected to procedures to ensure the contractor was not suspended or debarred.
Questioned Costs: None.
Identification As A Repeat Finding: Not applicable.
Recommendation: We recommend that management evaluate their existing internal control for the review of reports, and consider enhancing it to ensure that all reports are submitted by applicable deadlines.
Views Of Responsible Officials: Along with strengthening of reporting, the hiring of the dedicated Grants Coordinator position additionally improved controls related to procurement. Updated internal forms to document purchasing and classify procurement requirements were established and integrated with project management tools; new procurement templates were established; and improved repositories for cataloguing procurement materials and invoices were established. Additionally, moving forward, the suspension and disbarment language will now be included specifically in all contracts and has been added into the contract template.