Audit 395320

Significant deficiency in internal control over compliance related to suspension and debarment. Federal Agency: Department of Housing and Urban Development Program Title: Economic Development Initiative, Community Project Funding, and Miscellaneous Grants Assistance Listing Number: 14.251 Awards Number: B-24-CP-WA-2268 Award Period: 08/13/2024 - 08/31/2032 Criteria The regulations in 2 U.S. Code of Federal Regulations (CRF) Part 180 – OMB Guidelines to Agencies on Government-Wide Debarment and Suspension (2.CFR.180) restrict making Federal awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from receiving or participating in Federal awards. Condition/Context for Evaluation For the year ended June 30, 2025, the Organization did not perform suspension and debarment requirements prior to, or at the time of, entering into the transaction for three out of four covered transactions selected for testing as part of the audit. Instead, suspension and debarment checks were performed after the covered transaction occurred. Cause The Organization did not have internal controls in place to ensure suspension and debarment checks were occurring timely. Effect or potential effect The Organization did not fully comply with the suspension and debarment requirements regarding covered transactions. Questioned costs No questioned costs were determined as covered transactions did not occur with suspended or debarred parties based on post transaction analysis. Repeat audit finding No. Recommendation We recommend that the Organization ensure suspension and debarment procedures are incorporated into their procurement policy and are completed timely in accordance with 2.CFR.180. Views of responsible officials Management concurs with the finding and has provided the accompanying management corrective action plan.