Audit 391244

Criteria or specific requirement: In accordance with Uniform Guidance 2 CFR 180.300, nonfederal entities entering into covered transactions must verify that a party is not suspended or debarred from conducting business with the federal government. That verification may be performed by checking exclusions in SAM.gov, obtaining a certification from the vendor, or including a suspension and debarment clause or condition to the covered transaction. Additionally, pursuant to 2 CFR 200.303, the University is required to establish and maintain effective internal controls over federal awards to provide reasonable assurance that federal awards are managed in compliance with applicable federal statutes, regulations, and the terms and conditions of the federal award. Condition: During testing of suspension and debarment compliance for vendors with payments exceeding $25,000, CLA noted that 2 of 40 vendors tested did not have documentation evidencing that the vendor was verified as not suspended or debarred prior to entering into a contract. Questioned costs: None. Context: The University of Idaho entered into transactions with 2 vendors prior to verifying that the vendors were not suspended or debarred. Cause: The University of Idaho's control designed to verify vendor suspension and debarment status prior to contract execution is not operating effectively. Effect: There is an increased risk that suspended or debarred vendors could be contracted using federal funds. Repeat finding: No. Recommendation: CLA recommends that the University implement a more effective suspension and debarment policy and establish corresponding controls to ensure vendor eligibility is verified prior to entering into covered transactions. Views of responsible officials: There is no disagreement with the audit finding.