FINDING 2022-001 Subject: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds - Procurement and Suspension and Debarment Federal Agency: Department of the Treasury Federal Program: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Assistance Listings Number: 21.027 Federal Award Number and Year (or Other Identifying Number): SLFRP2971 Compliance Requirement: Procurement and Suspension and Debarment Audit Findings: Material Weakness, Modified Opinion Condition and Context An effective internal control system was not in place at the County to ensure compliance with the requirements related to the grant agreement and the Procurement and Suspension and Debarment compliance requirement. Procurement The County's purchasing policy did not reflect applicable state laws and regulations. In addition, the policy did not include procedures to avoid acquisition of unnecessary or duplicative items, or procedures to ensure that all solicitations incorporate a clear and accurate description of the technical requirements for the material, product, or service to be procured. Suspension and Debarment Prior to entering into subawards and covered transactions with State and Local Fiscal Recovery Funds (SLFRF) award funds, recipients are required to verify that such contractors and subrecipients are not suspended, debarred, or otherwise excluded. "Covered transactions" include, but are not limited to, contracts for goods and services awarded under a nonprocurement transaction (i.e., grant agreement) that are expected to equal or exceed $25,000. The verification is to be done by checking the Excluded Parties List System (EPLS), collecting a certification from that person, or adding a clause or condition to the covered transaction with that person. Upon inquiry of the County to review the procedures in place for verifying that an entity with which it plans to enter into a covered transaction is not suspended, debarred, or otherwise excluded, the County divulged that it was unaware of the suspension and debarment requirements related to the SLFRF awards. A population of four covered transactions, totaling $990,897, that equaled or exceeded $25,000 paid from SLFRF funds during the audit period was identified. For each of the four transactions, the County did not verify the suspension and debarment status prior to payment due to the County not having any policies or procedures in place to verify that contractors and subrecipients were neither suspended nor debarred, or otherwise excluded or disqualified from participating in federal assistance programs or activities. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.318(a) states: "The non-Federal entity must have and use documented procurement procedures, consistent with State, local, and tribal laws and regulations and the standards of this section, for the acquisition of property or services required under a Federal award or subaward. The non- Federal entity's documented procurement procedures must conform to the procurement standards identified in ?? 200.317 through 200.327." 2 CFR 200.214 states: "Non-federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities." 31 CFR 19.300 states: "When you enter into a covered transaction with another person at the next lower tier, you must verify that the person with whom you intend to do business is not excluded or disqualified. You do this by: (a) Checking the EPLS; or (b) Collecting a certification from that person if allowed by this rule; or (c) Adding a clause or condition to the covered transaction with that person." Cause A proper system of internal controls was not designed by management of the County. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the County's management of what should be done to effect internal control, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, vendors and subrecipients to whom payments equal to or in excess of $25,000 were not verified to be not suspended, debarred, or otherwise excluded. Noncompliance with the provisions of Federal regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the County. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the County establish a proper system of internal controls and develop policies and procedures to ensure contractors and subrecipients, as appropriate are not suspended, debarred, or otherwise excluded prior to entering into any contracts or subawards. Additionally, we recommend the County establish documented procurement procedures consistent with state and local laws for the acquisition of property or services required under a federal award or subaward. The nonfederal entity's documented procurement procedures must conform to the procurement standards identified in ?? 200.317 through 200.327. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
Finding 2022-002: Procurement, Suspension, and Debarment (Significant Deficiency) Federal Program: 93.224 - U.S. Department of Health and Human Services Criteria or Specific Requirement: 2 CFR Section 200.214 requires that, for covered transactions, a non-Federal entity must verify that entities are not suspended, debarred or otherwise excluded. This verification may be accomplished by checking the System for Award Management (SAM) website maintained by the General Services Administration. Condition: For all disbursements tested, the Organization could not provide documentation of their verification, prior to payment, that the vendors were not suspended, debarred or otherwise excluded. Questioned Costs: $- Cause: The Organization did not require evidence of SAM checks be maintained in its vendor files. As a result, the Organization did not maintain adequate support to provide evidence that appropriate suspension and debarment searches were performed. Despite the lack of documentation, a search was performed after the fact to verify that the vendors or individuals in our sample were not suspended, debarred or otherwise excluded. Therefore, no questioned costs have been reported related to the sample that was tested. Effect or Potential Effect: The Organization was not in compliance with the procurement documentation requirements of the Uniform Guidance. As a result, the Organization could not readily provide evidence that it had assessed whether or not its vendors were suspended, debarred, or otherwise excluded. As a result, the potential for payments to suspended, debarred, or otherwise excluded vendors and individuals exists. Recommendation: The Organization should establish internal controls to ensure proper documentation is maintained as evidence to support that the Organization performed the required suspension and debarment searches on the SAM website.
Federal Grants Management - Procurement Policy ? Suspension and Debarment Federal Agency: Department of Treasury Federal Program Name: Coronavirus State and Local Fiscal Recovery Funds Assistance Listing Number: 21.027 Federal Award Identification Number and Year: N/A Pass-Through Agency: Michigan Department of Treasury Award Period: March 1, 2021 ? December 31, 2024 Type of Finding: Material Weakness in Internal Control over Compliance and Other Matter Criteria or Specific Requirement 2 CFR Section 200.214 requires non-federal entities to follow suspension and debarment regulations outlined in 2 CFR part 180. When a nonfederal entity enters into a covered transaction with an entity at a lower tier, the nonfederal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. Condition The County did not perform a search for suspension and debarment for vendors the County initiated procurement transactions in excess of $25,000. Questioned Costs None Context There were five transactions that exceeded the $25,000 covered transaction threshold during the granting period. During our testing, it was noted on all five items tested that Dickinson County, Michigan was not reviewing vendors prior to entering into a contract with a vendor to ensure the vendor was not on the suspended or debarred vendor list maintained by the General Services Administration. Cause The County was not aware of the requirements under suspension and debarment. Effect The County could contract with a vendor that has been suspended or debarred from receiving federal funds. Recommendation We recommend the County use sam.gov or the ELPS listing to review clients at the beginning of the year or before a transaction is incurred in accordance with Uniform Guidance requirements. Views of Responsible Officials and Planned Corrective Actions There is no disagreement with the audit finding.
FINDING 2022-004 Subject: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds - Suspension and Debarment Federal Agency: Department of the Treasury Federal Program: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Assistance Listings Number: 21.027 Federal Award Number and Year (or Other Identifying Number): FY2022 Compliance Requirement: Procurement and Suspension and Debarment Audit Findings: Material Weakness, Modified Opinion Condition and Context The County elected to receive the standard revenue loss allowance, allowing the County to claim its total State and Local Fiscal Recovery Funds (SLFRF) allocation of $8,688,084 as revenue loss to use for government services. As such, all SLFRF program funds were expended under the revenue loss eligible use category. The Department of the Treasury (Treasury) determined that there are no subawards under this eligible use category, and that recipients' use of revenue loss funds would not give rise to subrecipient relationships given that there is no federal program or purpose to carry out in the case of the revenue loss portion of the award. Prior to entering into subawards and covered transactions with SLFRF award funds, recipients are required to verify that such contractors and subrecipients are not suspended, debarred, or otherwise excluded. "Covered transactions" include, but are not limited to contracts for goods and services awarded under a non-procurement transaction (i.e., grant agreement) that are expected to equal or exceed $25,000. The verification is to be done by checking the Excluded Parties List System (EPLS), collecting a certification from that person, or adding a clause or condition to the covered transaction with that person. Due to the Treasury's determination that the revenue loss eligible use category does not give rise to subawards, the County was only required to comply with suspension and debarment requirements related to covered transactions. Upon inquiry of the County in order to review the procedures in place for verifying that an entity with which it plans to enter into a covered transaction is not suspended, debarred, or otherwise excluded, the County divulged that they were unaware of the suspension and debarment requirements related to the SLFRF awards. One covered transaction paid on the County's Build-Operate-Transfer agreement that equaled or exceeded $25,000 was identified. The one transaction, totaling $5,096,841, during the audit period, was selected for testing. For the noted transaction, the County did not verify the vendor's suspension and debarment status prior to payment due to the County not having any policies or procedures in place to verify that contractors were neither suspended nor debarred, or otherwise excluded or disqualified from participating in federal assistance programs or activities. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.214 states in part: "Non-Federal entities and contractors are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations . . . restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities." 31 CFR 19.300 states: "When you enter into a covered transaction with another person at the next lower tier, you must verify that the person with whom you intend to do business is not excluded or disqualified. You do this by: (a) Checking the EPLS; or (b) Collecting a certification from that person if allowed by this rule; or (c) Adding a clause or condition to the covered transaction with that person." Cause A proper system of internal controls was not designed by management of the County. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the County's management of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, vendors to whom payments equal to or in excess of $25,000 were not verified to be not suspended, debarred, or otherwise excluded. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the County. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the County establish a proper system of internal controls and develop policies and procedures to ensure contractors and subrecipients, as appropriate are not suspended, debarred, or otherwise excluded prior to entering into any contracts or subawards. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
2022-003 - Controls over Suspension and Debarment Finding Type: Material Weakness over Federal Awards Programs: Water and Waste Disposal Systems for Rural Communities (Assistance Listing Number 10.760) Criteria: Per 2 CFR ? 200.214 Suspension and debarment: Non-Federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. Condition/Finding: The Village had no controls in place, as required by the Uniform Guidance, to ensure that all parties that the Village enters into covered transactions with are eligible for participation in federal assistance programs or activities. However, during our testing, we found that all covered transactions entered into by the Village were with eligible parties. Cause: The Village did not have written policies and procedures over procurement, including suspension and debarment, as required by the Uniform Guidance. Effect: As a result of this condition, the Village had increased risk of inadvertently entering into a covered transaction with an ineligible party. Questioned Costs: No costs have been questioned as a result of this finding. Repeat Finding: No Recommendation: We recommend that the Village Council and management adopt, and follow, written policies and procedures (that conform with requirements of the Uniform Guidance) to ensure that future contracts are properly documented and awarded in a manner that documents that the Village verified all parties under covered transactions are eligible for participation in federal programs or activities. View of Responsible Officials (Corrective Action): See corrective action plan.
FINDING 2022-006 Subject: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds - Suspension and Debarment Federal Agency: Department of the Treasury Federal Program: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Assistance Listings Number: 21.027 Federal Award Number and Year (or Other Identifying Number): OMB Approved No 1505-0271 Compliance Requirement: Procurement and Suspension and Debarment Audit Findings: Material Weakness, Other Matters Condition and Context The County elected to receive the standard revenue loss allowance, allowing the County to claim up to $10 million of its total State and Local Fiscal Recovery Funds (SLFRF) allocation of $4,637,050 as revenue loss to use for government services. As such, all SLFRF program funds expended in 2022 were under the revenue loss eligible use category. The Department of the Treasury (Treasury) determined that there are no subawards under this eligible use category, and that recipients' use of revenue loss funds would not give rise to subrecipient relationships given that there is no federal program or purpose to carry out in the case of the revenue loss portion of the award. Prior to entering into subawards and covered transactions with SLFRF award funds, recipients are required to verify that such contractors and subrecipients are not suspended, debarred, or otherwise excluded. "Covered transactions" include, but are not limited to contracts for goods and services awarded under a non-procurement transaction (i.e., grant agreement) that are expected to equal or exceed $25,000. The verification is to be done by checking the Excluded Parties List System (EPLS), collecting a certification from that person, or adding a clause or condition to the covered transaction with that person. Due to the Treasury's determination that the revenue loss eligible use category does not give rise to subawards, the County was only required to comply with suspension and debarment requirements related to contracts. The County's policies related to SLFRF suspension and debarment requirements were as follows: for all vendor procurement contracts a suspension and debarment clause was included; however, if the purchase is expected to exceed $25,000, but not require a procurement contract, then a certification is requested from the vendor. In the event a certification is not provided by the vendor, the County Auditor checks the SAMs exclusions. Of the six transactions that equaled or exceeded $25,000 that were paid from SLFRF funds during the audit period, two were selected for testing to verify the County followed its procedures related to suspension and debarment. One transaction in the amount of $118,840 was made for the purchase of communications equipment. The contract between the vendor and the County included a suspension and debarment clause. The second transaction selected for testing in the amount of $33,170 was made to repair/replace the drain. A formal contract was not required and was not entered into with the vendor. However, proof of a certification from the vendor, or a SAMs exclusion check by the County could not be provided for audit. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.214 states in part: "Non-federal entities and contractors are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations . . . restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities." 31 CFR 19.300 states in part: "When you enter into a covered transaction with another person at the next lower tier, you must verify that the person with whom you intend to do business is not excluded or disqualified. You do this by: (a) Checking the EPLS; or (b) Collecting a certification from that person if allowed by this rule; or (c) Adding a clause or condition to the covered transaction with that person." Cause The system of internal controls as established by management of the County was not properly implemented to ensure that the policies and procedures in place related to suspension and debarment were appropriately followed. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, vendors to whom payments equal to or in excess of $25,000 were not verified to be not suspended, debarred, or otherwise excluded. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the County. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the County establish a proper system of internal controls, including strengthening its policies and procedures to ensure its compliance with requirements related to suspension and debarment. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-002 Subject: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds - Procurement and Suspension and Debarment Federal Agency: Department of the Treasury Federal Program: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Assistance Listings Number: 21.027 Federal Award Number and Year (or Other Identifying Number): FY 2022 Compliance Requirement: Procurement and Suspension and Debarment Audit Findings: Material Weakness, Modified Opinion Condition and Context The County elected to receive the standard revenue loss allowance, allowing them to claim its total State and Local Fiscal Recovery Funds (SLFRF) allocation of $6,597,109 as revenue loss to use for government services. As such, all SLFRF program funds to date were expended under the revenue loss eligible use category. The Department of the Treasury (Treasury) determined that there are no subawards under this eligible use category, and that recipients' use of revenue loss funds would not give rise to subrecipient relationships given that there is no federal program or purpose to carry out in the case of the revenue loss portion of the award. Prior to entering into subawards and covered transactions with SLFRF award funds, recipients are required to verify that such contractors and subrecipients are not suspended, debarred, or otherwise excluded. "Covered transactions" include, but are not limited to contracts for goods and services awarded under procurement and non-procurement transactions (i.e. grant agreement) that are expected to equal or exceed $25,000. The verification is to be done by checking the Excluded Parties List System, collecting a certification from that person, or adding a clause or condition to the covered transaction with that person. Due to Treasury's determination that the revenue loss eligible use category does not give rise to subawards, the County was only required to comply with suspension and debarment requirements related to covered transactions. Upon inquiry of the County's policies and procedures related to suspension and debarment requirements, the County divulged that they did not have policies or procedures in place for verifying that an entity with which it plans to enter into a covered transaction is not suspended, debarred, or otherwise excluded or disqualified from participating in federal assistance programs or activities. Two covered transactions for goods or services that equaled or exceeded $25,000 that were paid from SLFRF funds during the audit period were identified. Each transaction was examined to determine whether the County verified the suspension and debarment status of either vendor prior to payment. The first covered transaction in the amount of $77,764 was made to a contractor for the preparation of the County's SLFRF financial plan. The contract, as provided by the contractor included a clause stating they were neither excluded nor disqualified. Although the contract was signed by a County official, the contract was not appropriately reviewed by the County to ensure the suspension and debarment clause was included prior to signing. The second covered transaction in the amount of $227,253 was made for the purchase of police radios and associated accessories, as well as for the installation of the equipment. The County was unable to provide documentation to support whether the County verified the vendor's suspension and debarment status prior to issuing payment. The lack of internal controls was a systemic issue throughout the audit period. The noncompliance was isolated to the second covered transaction as noted above. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.318(i) states: "The non-Federal entity must maintain records sufficient to detail the history of procurement. These records will include, but are not necessarily limited to, the following: Rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price." 2 CFR 200.214 states: "Non-Federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities." 31 CFR 19.300 states: "When you enter into a covered transaction with another person at the next lower tier, you must verify that the person with whom you intend to do business is not excluded or disqualified. You do this by: (a) Checking the EPLS; or (b) Collecting a certification from that person if allowed by this rule; or (c) Adding a clause or condition to the covered transaction with that person." Cause A proper system of internal controls was not designed by management of the County. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the County's management of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, vendors to whom payments equal to or in excess of $25,000 were not verified to be not suspended, debarred, or otherwise excluded. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the County. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the County establish a proper system of internal controls and develop policies and procedures to ensure contractors and subrecipients, as appropriate, are not suspended, debarred, or otherwise excluded prior to entering into any contracts or subawards. We also recommended that supporting documentation be retained in order to be presented for audit. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
Finding 2022-002: Procurement Suspension and Debarment U.S. Department of Health and Human Services ? Assistance listing No. 93.526, Grants for Capital Development in Health Centers, award number C8ECS44745. Criteria: In accordance with 2 CFR section 200.214, Suspension and Debarment, ?The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities.? Condition: FMCS did not have evidence of verification that vendors are not suspended or debarred from federal and/or state contracts. Cause: FMCS has a procurement policy which indicates ?Certain contracts will not be made to parties listed on the nonprocurement portion of the General Services Administration?s `List of Parties Excluded from Federal Procurement or Nonprocurement Programs? in accordance with Executive Orders 12549 and 12689, `Debarment and Suspension.? (See 45 C.F.R. Part 76). This list contains the names of parties debarred, suspended, or otherwise excluded by agencies, and contractors declared ineligible under statutory authority other than E.O. 12549.? However, there is no evidence this policy was followed during 2022 for vendors/contractors engaged. Effect: FMCS has not documented that it performed required verification. Questioned Costs: Unknown Context: FMCS?s procurement policy specifies contracts will not be awarded to ?parties listed on the nonprocurement portion of the General Services Administration?s `List of Parties Excluded from Federal Procurement or Nonprocurement Programs? in accordance with Executive Orders 12549 and 12689, `Debarment and Suspension??. The request for evidence of verification that vendors were not suspended or disbarred was not provided prior to conclusion of the audit. Repeat Finding: Yes, 2021-001. Recommendation: FMCS should provide training on procurement policy and update policy to include retention of support for compliance with policy.View of responsible officials and planned corrective actions: FMCS concurs with the finding and recommendation of the auditor. The reason this is a repeat finding is because this finding occurred on the 2020 audit, which was completed February 1, 2022. (a three-year period). Our response to the finding was "The procurement policy will be revised to include retention of support for compliance before the March board meeting. Training on our procurement policy will be provided by March 31, 2022". The policy was revised and presented to and approved by the board of directors at the March 16, 2022, meeting. The training occurred for the human resources (HR) staff, who are charged with performing the compliance check, in March. The policy was implemented in March 2022.
2022 ? 001 Federal Agencies: U.S. Department of Treasury Federal Program Names: Coronavirus State and Local Fiscal Recovery Funds Assistance Listing Number: 21.027 Pass-Through Agency: Direct Award and Wisconsin Department of Health Services Award Period: March 2020 through December 31, 2024 Type of Finding: ? Significant Deficiency in Internal Control over Compliance Criteria or specific requirement: Per 2 CFR Part 200 Section 200.214 - Non-Federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. Condition: During our testing, we noted the City of Wauwatosa did not have adequate internal controls designed to ensure vendors were not suspended or debarred. Questioned costs: None Context: For 1 of the 1 vendors, with in the Coronavirus State and Local Fiscal Recovery Fund program, selected for testing, the City did not verify and retain documentation of the verification for any that vendors were not suspended or debared by the Federal Government. The auditor noted no instances of noncompliance with the provisions of procurement, suspension, and debarment; however, the lack of internal controls over these compliance requirements provides an opportunity for noncompliance. Cause: The City had not designed and implemented controls related to the verification and documentation of vendor's status as not suspended or debarred with the Federal Government. Effect: The lack of internal controls over these compliance requirements provides an opportunity for noncompliance. Repeat Finding: The finding is a repeat finding of 2021-001. Recommendation: We recommend the City of Wauwatosa design controls to ensure an adequate review process is in place to review potential contractors to determine they are not suspended or debarred. Views of responsible officials: There is no disagreement with the audit finding.
2022 ? 001 Federal Agencies: U.S. Department of Treasury Federal Program Names: Coronavirus State and Local Fiscal Recovery Funds Assistance Listing Number: 21.027 Pass-Through Agency: Direct Award and Wisconsin Department of Health Services Award Period: March 2020 through December 31, 2024 Type of Finding: ? Significant Deficiency in Internal Control over Compliance Criteria or specific requirement: Per 2 CFR Part 200 Section 200.214 - Non-Federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. Condition: During our testing, we noted the City of Wauwatosa did not have adequate internal controls designed to ensure vendors were not suspended or debarred. Questioned costs: None Context: For 1 of the 1 vendors, with in the Coronavirus State and Local Fiscal Recovery Fund program, selected for testing, the City did not verify and retain documentation of the verification for any that vendors were not suspended or debared by the Federal Government. The auditor noted no instances of noncompliance with the provisions of procurement, suspension, and debarment; however, the lack of internal controls over these compliance requirements provides an opportunity for noncompliance. Cause: The City had not designed and implemented controls related to the verification and documentation of vendor's status as not suspended or debarred with the Federal Government. Effect: The lack of internal controls over these compliance requirements provides an opportunity for noncompliance. Repeat Finding: The finding is a repeat finding of 2021-001. Recommendation: We recommend the City of Wauwatosa design controls to ensure an adequate review process is in place to review potential contractors to determine they are not suspended or debarred. Views of responsible officials: There is no disagreement with the audit finding.
FINDING 2022-001 Subject: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds - Suspension and Debarment Federal Agency: Department of the Treasury Federal Program: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Assistance Listings Number: 21.027 Federal Award Number and Year (or Other Identifying Number): FY2022 Compliance Requirement: Procurement and Suspension and Debarment Audit Findings: Material Weakness, Modified Opinion Condition and Context The County elected to receive the standard revenue loss allowance, allowing them to claim up to $10 million of its total State and Local Fiscal Recovery Funds (SLFRF) allocation of $15,183,218 as revenue loss to use for government services. During the audit period, SLFRF program funds were expended under the revenue loss eligible use category totaling $988,108 and under the Public Health and Economic Impacts use category totaling $5,000,000. Prior to entering into subawards and covered transactions with SLFRF award funds, recipients are required to verify that such contracts and subrecipients are not suspended, debarred, or otherwise excluded. "Covered transactions" include, but are not limited to contracts for goods and services awarded under a non-procurement transaction (i.e., grant agreement) that are expected to equal or exceed $25,000. The verification is to be done by checking the Excluded Parties List System (EPLS), collecting a certification from that person, or adding a clause or condition to the covered transaction with that person. The County's policies related to SLFRF suspension and debarment requirements included that all vendors be checked for suspension and debarment. However, of the 13 transactions that equaled or exceeded $25,000 that were paid from the SLFRF funds during the audit period, 11 vendors, totaling $844,613, were determined to not have been checked for suspension or debarment. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.214 states: "Non-federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities." 31 CFR 19.300 states: "When you enter into a covered transaction with another person at the next lower tier, you must verify that the person with whom you intend to do business is not excluded or disqualified. You do this by: (a) Checking the EPLS; or (b) Collecting a certification from that person if allowed by this rule; or (c) Adding a clause or condition to the covered transaction with that person." Cause The system of internal controls, as established by management of the County, was not properly implemented to ensure that the policies and procedures in place related to suspension and debarment were appropriately followed. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, vendors to whom payments equal to or in excess of $25,000 were not verified to be not suspended, debarred, or otherwise excluded. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the County. Questioned Costs There were no questioned costs identified. Recommendation We recommended the County's management design and implement a system of internal controls related to suspension and debarment procedures to ensure entities are neither suspended nor debarred, or otherwise excluded or disqualified prior to entering into any covered transactions. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
CFDA #10.760 USDA Water and Waste Disposal Procurement, Suspension & Debarment Finding 2022-003 ? Noncompliance with Federal Code of Regulations 2 CFR 200.214 Criteria: 2 CFR 200.214 requires the non-federal entity to maintain written documentation verifying that all vendors working on federal contracts have not been suspended or debarred. Condition: The procurement package for one of two vendors selected for testing did not have documentation showing where management verified the vendor?s eligibility to work on federal contracts. Cause: Management was unaware of the specific requirements noted in 2 CFR 200.214. Effect: A vendor could have been utilized on the federally-funded project when they were not allowed to work on a federal contract. Questioned Costs: There were no questioned costs. Context: The auditor verified through sam.gov that the vendor had not been suspended or debarred. Repeat Finding: This is not a repeat finding, as this is a new federal award for 2022. Recommendation: We recommend management amend the procurement policy to include specific procedures to ensure vendors/contractors on Federal projects have not been suspended or debarred. This verification should be performed on every contractor/vendor, and said verification should be documented in writing as part of the contract procurement package. Views of Responsible Officials and Planned Corrective Action: Management agrees with the above finding and will amend the Procurement Policy to include a vetting process to avoid a selection of a contractor /vendor that has been suspended or debarred from working on Federal Contracts.
FINDING 2022-001 Subject: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds - Suspension and Debarment Federal Agency: Department of the Treasury Federal Program: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Assistance Listings Number: 21.027 Federal Award Number and Year (or Other Identifying Number): FY 2022 Compliance Requirement: Procurement and Suspension and Debarment Audit Findings: Material Weakness, Modified Opinion Condition and Context The County elected to receive the standard revenue loss allowance, allowing the County to claim its total State and Local Fiscal Recovery Funds (SLFRF) allocation of $2,750,000 as revenue loss to use for government services. As such, all SLFRF program funds were expended under the revenue loss eligible use category. The Department of the Treasury (Treasury) determined that there are no subawards under this eligible use category, and that recipients' use of revenue loss funds would not give rise to subrecipient relationships given that there is no federal program or purpose to carry out in the case of the revenue loss portion of the award. Prior to entering into subawards and covered transactions with SLFRF award funds, recipients are required to verify that such contractors and subrecipients are not suspended, debarred, or otherwise excluded. "Covered transactions" include, but are not limited to, contracts for good and services awarded under a non-procurement transaction (i.e., grant agreement) that are expected to equal or exceed $25,000. The verification is to be done by checking the Excluded Parties List System (EPLS), collecting a certification from that person or entity, or adding a clause or condition to the covered transaction with that person or entity. Due to the Treasury's determination that the revenue loss eligible use category does not give rise to subawards, the County was only required to comply with suspension and debarment requirements related to covered transactions. Upon inquiry with the County in order to review the procedures in place for verifying that an entity with which it plans to enter into a covered transaction is not suspended, debarred, or otherwise excluded, the County explained that they were unaware of the suspension and debarment requirements related to the SLFRF awards. One covered transaction for goods or services that equaled or exceeded $25,000 paid from SLFRF funds during the audit period was identified. Upon testing that transaction, which totaled $2,695,327, it was determined that the County did not verify that the vendor was neither suspended nor debarred, or otherwise excluded or disqualified from participating in federal assistance programs or activities. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.214 states in part: "Non-federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal programs or activities." 31 CFR 19.300 states: "When you enter into a covered transaction with another person at the next lower tier, you must verify that the person with whom you intend to do business is not excluded or disqualified. You do this by: (a) Checking the EPLS; or (b) Collecting a certification from that person if allowed by this rule; or (c) Adding a clause or condition to the covered transaction with that person." Cause A proper system of internal controls was not designed by management of the County. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the County's management of what should be done to effect internal control, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, the vendor to whom payments equal to or in excess of $25,000 was not verified to be not suspended, debarred, or otherwise excluded. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the County. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the County establish a proper system of internal controls and develop policies and procedures to ensure contractors and subrecipients, as appropriate, are not suspended, debarred, or otherwise excluded prior to entering into any contracts or subawards. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-003 Subject: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds - Suspension and Debarment Federal Agency: Department of the Treasury Federal Program: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Assistance Listings Number: 21.027 Federal Award Number and Year (or Other Identifying Number): FY2021 Compliance Requirement: Procurement and Suspension and Debarment Audit Findings: Material Weakness, Modified Opinion Condition and Context The County elected to receive the standard revenue loss allowance, allowing the County to claim its total State and Local Fiscal Recovery Funds (SLFRF) allocation of $6,597,109 as revenue loss to use for government services. As such, all SLFRF program funds to date were expended under the revenue loss eligible use category. The U.S. Department of the Treasury (Treasury) determined that there are no subawards under this eligible use category, and that recipients' use of revenue loss funds would not give rise to subrecipient relationships given that there is no federal program or purpose to carry out in the case of the revenue loss portion of the award. Prior to entering into subawards and covered transactions with SLFRF award funds, recipients are required to verify that such contractors and subrecipients are not suspended, debarred, or otherwise excluded. "Covered transactions" include, but are not limited to contracts for goods and services awarded under procurement and non-procurement transactions (i.e., grant agreement) that are expected to equal or exceed $25,000. The verification is to be done by checking the Excluded Parties List System, collecting a certification from that person, or adding a clause or condition to the covered transaction with that person. Due to the Treasury's determination that the revenue loss eligible use category does not give rise to subawards, the County was only required to comply with suspension and debarment requirements related to covered transactions. The County's policies and procedures related to suspension and debarment requirements included a verification search on the SAMs website by one individual with a second individual reviewing the search. One of the individuals is to be the department head of the department receiving the grant award. The signatures of the individuals are to be transcribed with the results of the search and the date. The only covered transaction totaling $425,875 made during the audit period was for the purchase of police radios and associated accessories. The County was unable to provide documentation to show the review of the vendor's suspension and debarment status. As such we could not determine if the County complied with the suspension and debarment requirement. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.214 states: "Non-Federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities." 31 CFR 19.300 states: "When you enter into a covered transaction with another person at the next lower tier, you must verify that the person with whom you intend to do business is not excluded or disqualified. You do this by: (a) Checking the EPLS; or (b) Collecting a certification from that person if allowed by this rule; or (c) Adding a clause or condition to the covered transaction with that person." Cause The system of internal controls as established by management of the County was not properly implemented to ensure that the policies and procedures in place related to suspension and debarment resulted in adequate supporting documentation being retained for audit. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, no documentation was retained of the status of the vendor to whom a payment equal to or in excess of $25,000 were made. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the County. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the County establish a proper system of internal controls, including strengthening its policies and procedures to ensure its compliance with requirements related to suspension and debarment. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
2022-003 - Federal Grants Management - Procurement Policy Federal Agency: Department of Treasury Federal Program Name: Coronavirus State and Local Fiscal Recovery Funds Assistance Listing Number: 21.027 Federal Award Identification Number and Year: N/A Pass-Through Agency: N/A Award Period: March 1, 2021 ? December 31, 2024 Type of Finding: Significant deficiency in internal control over compliance, other matters. Criteria or Specific Requirement: 2 CFR Section 200.214 requires non-federal entities to follow suspension and debarment regulations outlined in 2 CFR part 180. When a nonfederal entity enters into a covered transaction with an entity at a lower tier, the nonfederal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. 2 CFR 200.303 states ?The Non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) Condition: The County did not perform a search for suspension and debarment for vendors the County initiated procurement transactions in excess of $25,000. Questioned Costs: None Context: There were five transactions that exceeded the $25,000 covered transaction threshold during the granting period. During our testing, it was noted on four of the five items tested that Florence County was not reviewing vendors prior to entering into a contract with a vendor to ensure the vendor was not on the suspended or debarred vendor list maintained by the General Services Administration. Cause: The County was not aware of the requirements under suspension and debarment. Effect: The County could contract with a vendor that has been suspended or debarred from receiving federal funds. Recommendation: We recommend the County use sam.gov or the ELPS listing to review clients at the beginning of the year or before a transaction is incurred in accordance with Uniform Guidance requirements. Views of Responsible Officials and Planned Corrective Actions: There is no disagreement with the audit finding.
2022-003 - Federal Grants Management - Procurement Policy Federal Agency: Department of Treasury Federal Program Name: Coronavirus State and Local Fiscal Recovery Funds Assistance Listing Number: 21.027 Federal Award Identification Number and Year: N/A Pass-Through Agency: N/A Award Period: March 1, 2021 ? December 31, 2024 Type of Finding: Significant deficiency in internal control over compliance, other matters. Criteria or Specific Requirement: 2 CFR Section 200.214 requires non-federal entities to follow suspension and debarment regulations outlined in 2 CFR part 180. When a nonfederal entity enters into a covered transaction with an entity at a lower tier, the nonfederal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. 2 CFR 200.303 states ?The Non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) Condition: The County did not perform a search for suspension and debarment for vendors the County initiated procurement transactions in excess of $25,000. Questioned Costs: None Context: There were five transactions that exceeded the $25,000 covered transaction threshold during the granting period. During our testing, it was noted on four of the five items tested that Florence County was not reviewing vendors prior to entering into a contract with a vendor to ensure the vendor was not on the suspended or debarred vendor list maintained by the General Services Administration. Cause: The County was not aware of the requirements under suspension and debarment. Effect: The County could contract with a vendor that has been suspended or debarred from receiving federal funds. Recommendation: We recommend the County use sam.gov or the ELPS listing to review clients at the beginning of the year or before a transaction is incurred in accordance with Uniform Guidance requirements. Views of Responsible Officials and Planned Corrective Actions: There is no disagreement with the audit finding.
2022-002 Federal Agency: United States Department of Health and Human Services Federal Program Title: Health Center Cluster Assistance Listing Numbers: 93.224/93.527 Award Period: March 1, 2021 through February 28, 2022, March 1, 2022 through February 28, 2023, April 1, 2021 through March 31, 2023. Type of Finding: ? Significant Deficiency in Internal Control over Compliance and Noncompliance Criteria or specific requirement: The Code of Federal Regulations section 200.214 requires the Center to follow the nonprocurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. The Center should have policies and procedures in place to ensure contracts or subaward are not provided to third parties that are suspended or disbarred. Condition: During our testing, we noted the Center did not have formal policies or procedures in place to determine if vendors have been suspended or disbarred prior to entering into a contract until June 2022 when the policy was created. Context: During our audit work performed, it was identified that prior to June 2022, the Center did not have a process to check the 'System for Award Management (SAM) Exclusions' or other procedures to ensure third parties were not suspended or disbarred, or retain related support. These procedures were implemented after the new policy was created in June 2022. As a result there were instances of vendors utilized prior to the new policy where documentation was not available to show the vendor being checked against exclusion lists. All vendors over $25,000 under the health center cluster grants were checked against the exclusion list at time of audit, and no exclusions were noted. Cause: The Center did not have a formal suspension and disbarment policy in place for the full year that met Uniform Guidance requirements. There was a prior year audit finding related to the procurement policy, but due to the timing of audit issuance, the corrective action was not able to be implemented back to the beginning of 2022. Effect: The lack of a formal suspension and debarment policy provides the opportunity for noncompliance due to transactions with suspended or disbarred parties. Repeat Finding: Yes ? 2021-002 Recommendation: As the policy has already been revised, we recommend the Center follow the requirements under the new policy and ensure documentation is maintained as appropriate to support vendor checks against the SAM Exclusions list. Views of responsible officials and planned corrective actions: There is no disagreement with the audit finding. Management has revised the suspension and debarment policies and procedures to meet Uniform Guidance requirements, and will ensure the new policy and procedures are followed moving forward.
2022-002 Federal Agency: United States Department of Health and Human Services Federal Program Title: Health Center Cluster Assistance Listing Numbers: 93.224/93.527 Award Period: March 1, 2021 through February 28, 2022, March 1, 2022 through February 28, 2023, April 1, 2021 through March 31, 2023. Type of Finding: ? Significant Deficiency in Internal Control over Compliance and Noncompliance Criteria or specific requirement: The Code of Federal Regulations section 200.214 requires the Center to follow the nonprocurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. The Center should have policies and procedures in place to ensure contracts or subaward are not provided to third parties that are suspended or disbarred. Condition: During our testing, we noted the Center did not have formal policies or procedures in place to determine if vendors have been suspended or disbarred prior to entering into a contract until June 2022 when the policy was created. Context: During our audit work performed, it was identified that prior to June 2022, the Center did not have a process to check the 'System for Award Management (SAM) Exclusions' or other procedures to ensure third parties were not suspended or disbarred, or retain related support. These procedures were implemented after the new policy was created in June 2022. As a result there were instances of vendors utilized prior to the new policy where documentation was not available to show the vendor being checked against exclusion lists. All vendors over $25,000 under the health center cluster grants were checked against the exclusion list at time of audit, and no exclusions were noted. Cause: The Center did not have a formal suspension and disbarment policy in place for the full year that met Uniform Guidance requirements. There was a prior year audit finding related to the procurement policy, but due to the timing of audit issuance, the corrective action was not able to be implemented back to the beginning of 2022. Effect: The lack of a formal suspension and debarment policy provides the opportunity for noncompliance due to transactions with suspended or disbarred parties. Repeat Finding: Yes ? 2021-002 Recommendation: As the policy has already been revised, we recommend the Center follow the requirements under the new policy and ensure documentation is maintained as appropriate to support vendor checks against the SAM Exclusions list. Views of responsible officials and planned corrective actions: There is no disagreement with the audit finding. Management has revised the suspension and debarment policies and procedures to meet Uniform Guidance requirements, and will ensure the new policy and procedures are followed moving forward.
2022-002 Federal Agency: United States Department of Health and Human Services Federal Program Title: Health Center Cluster Assistance Listing Numbers: 93.224/93.527 Award Period: March 1, 2021 through February 28, 2022, March 1, 2022 through February 28, 2023, April 1, 2021 through March 31, 2023. Type of Finding: ? Significant Deficiency in Internal Control over Compliance and Noncompliance Criteria or specific requirement: The Code of Federal Regulations section 200.214 requires the Center to follow the nonprocurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. The Center should have policies and procedures in place to ensure contracts or subaward are not provided to third parties that are suspended or disbarred. Condition: During our testing, we noted the Center did not have formal policies or procedures in place to determine if vendors have been suspended or disbarred prior to entering into a contract until June 2022 when the policy was created. Context: During our audit work performed, it was identified that prior to June 2022, the Center did not have a process to check the 'System for Award Management (SAM) Exclusions' or other procedures to ensure third parties were not suspended or disbarred, or retain related support. These procedures were implemented after the new policy was created in June 2022. As a result there were instances of vendors utilized prior to the new policy where documentation was not available to show the vendor being checked against exclusion lists. All vendors over $25,000 under the health center cluster grants were checked against the exclusion list at time of audit, and no exclusions were noted. Cause: The Center did not have a formal suspension and disbarment policy in place for the full year that met Uniform Guidance requirements. There was a prior year audit finding related to the procurement policy, but due to the timing of audit issuance, the corrective action was not able to be implemented back to the beginning of 2022. Effect: The lack of a formal suspension and debarment policy provides the opportunity for noncompliance due to transactions with suspended or disbarred parties. Repeat Finding: Yes ? 2021-002 Recommendation: As the policy has already been revised, we recommend the Center follow the requirements under the new policy and ensure documentation is maintained as appropriate to support vendor checks against the SAM Exclusions list. Views of responsible officials and planned corrective actions: There is no disagreement with the audit finding. Management has revised the suspension and debarment policies and procedures to meet Uniform Guidance requirements, and will ensure the new policy and procedures are followed moving forward.
2022-002 Federal Agency: United States Department of Health and Human Services Federal Program Title: Health Center Cluster Assistance Listing Numbers: 93.224/93.527 Award Period: March 1, 2021 through February 28, 2022, March 1, 2022 through February 28, 2023, April 1, 2021 through March 31, 2023. Type of Finding: ? Significant Deficiency in Internal Control over Compliance and Noncompliance Criteria or specific requirement: The Code of Federal Regulations section 200.214 requires the Center to follow the nonprocurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. The Center should have policies and procedures in place to ensure contracts or subaward are not provided to third parties that are suspended or disbarred. Condition: During our testing, we noted the Center did not have formal policies or procedures in place to determine if vendors have been suspended or disbarred prior to entering into a contract until June 2022 when the policy was created. Context: During our audit work performed, it was identified that prior to June 2022, the Center did not have a process to check the 'System for Award Management (SAM) Exclusions' or other procedures to ensure third parties were not suspended or disbarred, or retain related support. These procedures were implemented after the new policy was created in June 2022. As a result there were instances of vendors utilized prior to the new policy where documentation was not available to show the vendor being checked against exclusion lists. All vendors over $25,000 under the health center cluster grants were checked against the exclusion list at time of audit, and no exclusions were noted. Cause: The Center did not have a formal suspension and disbarment policy in place for the full year that met Uniform Guidance requirements. There was a prior year audit finding related to the procurement policy, but due to the timing of audit issuance, the corrective action was not able to be implemented back to the beginning of 2022. Effect: The lack of a formal suspension and debarment policy provides the opportunity for noncompliance due to transactions with suspended or disbarred parties. Repeat Finding: Yes ? 2021-002 Recommendation: As the policy has already been revised, we recommend the Center follow the requirements under the new policy and ensure documentation is maintained as appropriate to support vendor checks against the SAM Exclusions list. Views of responsible officials and planned corrective actions: There is no disagreement with the audit finding. Management has revised the suspension and debarment policies and procedures to meet Uniform Guidance requirements, and will ensure the new policy and procedures are followed moving forward.
Finding 2022-003: Procurement, Suspension, and Debarment (Material Weakness) Information on the Federal Program: U.S. Department of State ALN 19.040 Criteria or Specific Requirement: 2 CFR Section 200.214 requires that, for covered transactions, a non-Federal entity must verify that entities are not suspended, debarred or otherwise excluded. This verification may be accomplished by checking the System for Award Management (SAM) website maintained by the General Services Administration. Condition: For all disbursements tested, FCE could not provide documentation of their verification, prior to payment, that the vendors were not suspended, debarred or otherwise excluded. Questioned Costs: None Cause: FCE did not require evidence of SAM checks be maintained in its vendor files. As a result, FCE did not maintain adequate support to provide evidence that appropriate suspension and debarment searches were performed. Despite the lack of documentation, a search was performed after the fact to verify that the vendors or individuals in our sample were not suspended, debarred or otherwise excluded. Therefore, no questioned costs have been reported related to the sample that was tested. Effect or Potential Effect: FCE was not in compliance with the procurement documentation requirements of the Uniform Guidance. As a result, FCE could not readily provide evidence that it had assessed whether or not its vendors were suspended, debarred, or otherwise excluded. As a result, the potential for payments to suspended, debarred, or otherwise excluded vendors and individuals exists. Recommendation: FCE should establish internal controls to ensure proper documentation is maintained as evidence to support that it performed the required suspension and debarment searches on the SAM website.
FINDING 2022-001 Subject: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds - Suspension and Debarment Federal Agency: Department of the Treasury Federal Program: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Assistance Listings Number: 21.027 Federal Award Number and Year (or Other Identifying Number): ARPA 2021-2022 Compliance Requirement: Procurement and Suspension and Debarment Audit Findings: Material Weakness, Modified Opinion Condition and Context The County elected to receive the standard revenue loss allowance, allowing the County to claim its total State and Local Fiscal Recovery Funds (SLFRF) allocation of $8,985,074 as revenue loss to use for government services. As such, all SLFRF program funds were expended under the revenue loss eligible use category. The Department of the Treasury (Treasury) determined that there are no subawards under this eligible use category and that recipients' use of revenue loss funds would not give rise to subrecipient relationships given that there is no federal program or purpose to carry out in the case of the revenue loss portion of the award. Prior to entering into subawards and covered transactions with SLFRF award funds, recipients are required to verify that such contractors and subrecipients are not suspended, debarred, or otherwise excluded. "Covered transactions" include, but are not limited to, contracts for goods and services awarded under a non-procurement transaction (i.e., grant agreement) that are expected to equal or exceed $25,000. The verification is to be done by checking the Excluded Parties List System (EPLS), collecting a certification from that person, or adding a clause or condition to the covered transaction with that person. Due to the Treasury's determination that the revenue loss eligible use category does not give rise to subawards, the County was only required to comply with suspension and debarment requirements related to covered transactions. Upon inquiry of the County in order to review the procedures in place for verifying that an entity with which it plans to enter into a covered transaction is not suspended, debarred, or otherwise excluded, the County divulged that they were unaware of the suspension and debarment requirements related to the SLFRF awards. A population of 14 covered transactions for goods or services that equaled or exceeded $25,000 paid from SLFRF funds during the audit period was identified. A sample of 3 transactions, totaling $1,189,544, was selected for testing. For each of the 3 transactions, the County did not verify the vendors' suspension and debarment status prior to payment due to the County not having any policies or procedures in place to verify that contractors were neither suspended nor debarred, or otherwise excluded or disqualified, from participating in federal assistance programs or activities. Due to the number and magnitude of exceptions identified, per auditor judgment, we concluded it would not be appropriate to expand the sample size or perform any additional audit procedures. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.214 states: "Non-federal entities and contractors are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. These regulations restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities." 31 CFR 19.300 states: "When you enter into a covered transaction with another person at the next lower tier, you must verify that the person with whom you intend to do business is not excluded or disqualified. You do this by: (a) Checking the EPLS; or (b) Collecting a certification from that person if allowed by this rule; or (c) Adding a clause or condition to the covered transaction with that person." Cause A proper system of internal controls was not designed by management of the County. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the County's management of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, vendors to whom payments equal to or in excess of $25,000 were not verified to be not suspended, debarred, or otherwise excluded. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the County. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the County establish a proper system of internal controls and develop policies and procedures to ensure contractors and subrecipients, as appropriate, are not suspended, debarred, or otherwise excluded prior to entering into any contracts or subawards. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-002 Subject: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds - Suspension and Debarment Federal Agency: Department of the Treasury Federal Program: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Assistance Listings Number: 21.027 Federal Award Number and Year (or Other Identifying Number): FY 2022 Compliance Requirement: Procurement and Suspension and Debarment Audit Findings: Material Weakness, Modified Opinion Condition and Context The County elected to receive the standard revenue loss allowance, allowing the County to claim its total State and Local Fiscal Recovery Funds (SLFRF) allocation of $7,694,555 as revenue loss to use for government services. As such, all SLFRF program funds were expended under the revenue loss eligible use category. The U. S. Department of the Treasury (Treasury) determined that there are no subawards under this eligible use category, and that recipients' use of revenue loss funds would not give rise to subrecipient relationships given that there is no federal program or purpose to carry out in the case of the revenue loss portion of the award. Prior to entering into subawards and covered transactions with SLFRF award funds, recipients are required to verify that such contractors and subrecipients are not suspended, debarred, or otherwise excluded. "Covered transactions" include, but are not limited to, contracts for good and services awarded under a non-procurement transaction (i.e., grant agreement) that are expected to equal or exceed $25,000. The verification is to be done by checking the Excluded Parties List System (EPLS), collecting a certification from that person or entity, or adding a clause or condition to the covered transaction with that person or entity. Due to the Treasury's determination that the revenue loss eligible use category does not give rise to subawards, the County was only required to comply with suspension and debarment requirements related to covered transactions. Upon inquiry of the County's policies and procedures related to suspension and debarment requirements, the County divulged that they did not have policies or procedures in place for verifying that an entity with which it plans to enter into a covered transaction is not suspended, debarred, or otherwise excluded or disqualified from participating in federal assistance programs or activities. Two covered transactions for goods or services that equaled or exceeded $25,000 that were paid from SLFRF funds during the audit period were identified. Each transaction was examined to determine whether the County verified the suspension and debarment status of either vendor prior to payment. The first covered transaction in the amount of $100,000 was made to a contractor for the construction of a new park pavilion. The contract, as provided by the contractor, included a clause stating they were neither excluded nor disqualified. Although the contract was signed by a County official, the contract was not appropriately reviewed by the County to ensure the suspension and debarment clause was included prior to signing. The second covered transaction in the amount of $144,359 was made for the purchase of new elevators for the annex building and the courthouse. The County was unable to provide documentation to support whether the County verified the vendor's suspension and debarment status prior to issuing payment. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.318(i) states: "The non-Federal entity must maintain records sufficient to detail the history of procurement. These records will include, but are not necessarily limited to, the following: Rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price." 2 CFR 200.214 states: "Non-federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities." 31 CFR 19.300 states: "When you enter into a covered transaction with another person at the next lower tier, you must verify that the person with whom you intend to do business is not excluded or disqualified. You do this by: (a) Checking the EPLS; or (b) Collecting a certification from that person if allowed by this rule; or (c) Adding a clause or condition to the covered transaction with that person." Cause A proper system of internal controls was not designed by management of the County. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the County's management view of what should be done to effect internal control, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, vendors to whom payments equal to or in excess of $25,000 were made, were not verified to be not suspended, debarred, or otherwise excluded. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the County. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the County establish a proper system of internal controls and develop policies and procedures to ensure contractors and subrecipients, as appropriate, are not suspended, debarred, or otherwise excluded prior to entering into any contracts or subawards. We also recommended that supporting documentation be retained in order to be presented for audit.
2022-004 Suspension and Debarment Federal Agency: US Department of the Treasury Federal Program Name: Coronavirus State and Local Fiscal Recovery Funds Assistance Listing Number: 21.027 Federal Award Identification Number and Year: Unknown Pass-Through Agency: Wisconsin Department of Health Services Pass-Through Number(s): 155811 Award Period: 3/3/2021-12/31/2024 Type of Finding: ? Significant Deficiency in Internal Control over Compliance ? Other Matter Criteria or Specific Requirement: 2 CFR Section 200.214 requires non-federal entities to follow suspension and debarment regulations outlined in 2 CFR part 180. When a nonfederal entity enters into a covered transaction with an entity at a lower tier, the nonfederal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. Condition: The County's Health Department verifies suspension and debarment status when there is a new vendor but did not continue to verify there was no change in that status in subsequent years when the vendor was used again. Questioned Costs: None Context: The one vendor used during 2022 that met the covered transaction threshold did not have any review completed by the County's public health department to ensure they were not suspended or debarred when initiating covered transactions in the current year. Cause: The County's Health Department misunderstood when verification of suspension and debarment status needs to be completed. Effect: County could contract with a vendor that has been suspended or debarred from receiving federal funds. Repeat Finding: Yes. The prior year finding was Finding 2021-004. Recommendation: We recommend the County use sam.gov or the ELPS listing to review clients prior to entering into procurement transactions in excess of the covered transaction threshold in accordance with the Uniform Guidance. We also recommend that there is a review of this documentation prior to approval of use of the vendor and that documentation of the search and approval is maintained. View of Responsible Officials: There is no disagreement with the audit finding.
Finding 2022-001: Suspension/Disbarment Searches Assistance listing number and name: 19.040 ? Public Diplomacy Programs 19.900 - AEECA/ESF PD Programs Year: 2022 Federal agency: U.S. Department of State Criteria: Per 2 CFR section 200.214, non-federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180, which restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in federal assistance programs or activities. When a non-federal entity enters into a covered transaction with an entity at a lower tier, the non-federal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. Condition and context: During our audit, we noted that IWPR did not perform timely, the search whether vendors were suspended or debarred, prior to payments. The searches were ultimately performed in 2023 but not during the procurement process in 2022 as required by the internal policy that vetting should be carried out prior to the procurement. This was rectified by performing ?post dated? vetting which confirmed IWPR did not support suspended or debarred parties. Cause: IWRP was aware of the requirement but due to turnover in the staff, this was not performed in timely manner. Effect: Vendors used could have been used for services performed as part of the federal award whilst suspended or disbarred. No vendors used were suspended or disbarred and thus there are no questioned costs. Repeat finding: No. Questioned costs: None noted. Recommendation: We recommend that management reviews periodically, if there is staff turnover, that the searches as part of its initial procurement processes and controls and retain documentation for each vendor. Views of responsible officials and planned corrective actions: Management acknowledges the finding and has implemented correction actions. See corrective action plan.
Finding 2022-001: Suspension/Disbarment Searches Assistance listing number and name: 19.040 ? Public Diplomacy Programs 19.900 - AEECA/ESF PD Programs Year: 2022 Federal agency: U.S. Department of State Criteria: Per 2 CFR section 200.214, non-federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180, which restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in federal assistance programs or activities. When a non-federal entity enters into a covered transaction with an entity at a lower tier, the non-federal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. Condition and context: During our audit, we noted that IWPR did not perform timely, the search whether vendors were suspended or debarred, prior to payments. The searches were ultimately performed in 2023 but not during the procurement process in 2022 as required by the internal policy that vetting should be carried out prior to the procurement. This was rectified by performing ?post dated? vetting which confirmed IWPR did not support suspended or debarred parties. Cause: IWRP was aware of the requirement but due to turnover in the staff, this was not performed in timely manner. Effect: Vendors used could have been used for services performed as part of the federal award whilst suspended or disbarred. No vendors used were suspended or disbarred and thus there are no questioned costs. Repeat finding: No. Questioned costs: None noted. Recommendation: We recommend that management reviews periodically, if there is staff turnover, that the searches as part of its initial procurement processes and controls and retain documentation for each vendor. Views of responsible officials and planned corrective actions: Management acknowledges the finding and has implemented correction actions. See corrective action plan.
2022 ? 003 Federal agency: U.S. Department of Health and Human Services Federal program title: Health Centers Cluster Assistance Listing Number: 93.224/93.527 Award Period: Varying project and budget periods: 1/1/21 ? 12/31/21, 4/1/20 ? 3/31/21, 5/1/20 ? 4/30/21, 3/15/20 ? 3/14/21, 4/1/21 ? 3/31/23 Type of Finding: ? Significant Deficiency in Internal Control over Compliance Criteria or specific requirement: The Code of Federal Regulations section 200.214 requires the Health Center to follow the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. The Health Center should have policies and procedures in place to ensure contracts or subaward are not provided to third parties that are suspended or disbarred, and retain documentation to support those procedures are being followed. Condition: During our testing, we noted the Health Center was not able to provide documentation to support that policies or procedures in place had been followed to determine if vendors have been suspended or disbarred prior to entering into a contract. Questioned costs: None Context: During our testing, a sample of three disbursement transactions greater than $25,000 were selected for suspension and disbarment testing. The Health Center did not have documentation available to support there was a check of the 'System for Award Management (SAM) Exclusions' or other procedures to ensure third parties were not suspended or disbarred. The vendor selected was compared to the SAM Exclusions at the time of testing and was noted to not be suspended or disbarred, although the testing could not be performed back to the date of the transaction. Cause: The Health Center either did not follow policies and procedures under the procurement policy related to suspension or debarment, or did not retain support of control procedures being performed. Effect: The lack of documentation or control over the formal suspension and debarment policy provides the opportunity for noncompliance due to transactions with suspended or disbarred parties. Repeat finding: The finding is a repeat of a finding in the immediately prior year. Prior year finding number 2021-003 was a significant deficiency. Recommendation: We recommend the Health Center follow the suspension and debarment policy with all applicable transactions, and retain documentation supporting the procedures performed. Views of responsible officials: There is no disagreement with the audit finding. Policy and procedures were put in place late in 2022 in response to the prior year audit finding.
2022 ? 003 Federal agency: U.S. Department of Health and Human Services Federal program title: Health Centers Cluster Assistance Listing Number: 93.224/93.527 Award Period: Varying project and budget periods: 1/1/21 ? 12/31/21, 4/1/20 ? 3/31/21, 5/1/20 ? 4/30/21, 3/15/20 ? 3/14/21, 4/1/21 ? 3/31/23 Type of Finding: ? Significant Deficiency in Internal Control over Compliance Criteria or specific requirement: The Code of Federal Regulations section 200.214 requires the Health Center to follow the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. The Health Center should have policies and procedures in place to ensure contracts or subaward are not provided to third parties that are suspended or disbarred, and retain documentation to support those procedures are being followed. Condition: During our testing, we noted the Health Center was not able to provide documentation to support that policies or procedures in place had been followed to determine if vendors have been suspended or disbarred prior to entering into a contract. Questioned costs: None Context: During our testing, a sample of three disbursement transactions greater than $25,000 were selected for suspension and disbarment testing. The Health Center did not have documentation available to support there was a check of the 'System for Award Management (SAM) Exclusions' or other procedures to ensure third parties were not suspended or disbarred. The vendor selected was compared to the SAM Exclusions at the time of testing and was noted to not be suspended or disbarred, although the testing could not be performed back to the date of the transaction. Cause: The Health Center either did not follow policies and procedures under the procurement policy related to suspension or debarment, or did not retain support of control procedures being performed. Effect: The lack of documentation or control over the formal suspension and debarment policy provides the opportunity for noncompliance due to transactions with suspended or disbarred parties. Repeat finding: The finding is a repeat of a finding in the immediately prior year. Prior year finding number 2021-003 was a significant deficiency. Recommendation: We recommend the Health Center follow the suspension and debarment policy with all applicable transactions, and retain documentation supporting the procedures performed. Views of responsible officials: There is no disagreement with the audit finding. Policy and procedures were put in place late in 2022 in response to the prior year audit finding.
2022 ? 003 Federal agency: U.S. Department of Health and Human Services Federal program title: Health Centers Cluster Assistance Listing Number: 93.224/93.527 Award Period: Varying project and budget periods: 1/1/21 ? 12/31/21, 4/1/20 ? 3/31/21, 5/1/20 ? 4/30/21, 3/15/20 ? 3/14/21, 4/1/21 ? 3/31/23 Type of Finding: ? Significant Deficiency in Internal Control over Compliance Criteria or specific requirement: The Code of Federal Regulations section 200.214 requires the Health Center to follow the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. The Health Center should have policies and procedures in place to ensure contracts or subaward are not provided to third parties that are suspended or disbarred, and retain documentation to support those procedures are being followed. Condition: During our testing, we noted the Health Center was not able to provide documentation to support that policies or procedures in place had been followed to determine if vendors have been suspended or disbarred prior to entering into a contract. Questioned costs: None Context: During our testing, a sample of three disbursement transactions greater than $25,000 were selected for suspension and disbarment testing. The Health Center did not have documentation available to support there was a check of the 'System for Award Management (SAM) Exclusions' or other procedures to ensure third parties were not suspended or disbarred. The vendor selected was compared to the SAM Exclusions at the time of testing and was noted to not be suspended or disbarred, although the testing could not be performed back to the date of the transaction. Cause: The Health Center either did not follow policies and procedures under the procurement policy related to suspension or debarment, or did not retain support of control procedures being performed. Effect: The lack of documentation or control over the formal suspension and debarment policy provides the opportunity for noncompliance due to transactions with suspended or disbarred parties. Repeat finding: The finding is a repeat of a finding in the immediately prior year. Prior year finding number 2021-003 was a significant deficiency. Recommendation: We recommend the Health Center follow the suspension and debarment policy with all applicable transactions, and retain documentation supporting the procedures performed. Views of responsible officials: There is no disagreement with the audit finding. Policy and procedures were put in place late in 2022 in response to the prior year audit finding.
Federal Agency: U.S. Department of the Treasury Federal Program Name: State and Local Fiscal Recovery Funds Assistance Listing Number: 21.027 Award Period: 3/3/2021 ? 12/31/2026 Type of Finding: Significant Deficiency in Internal Control over Compliance Criteria or Specific Requirement: 2 CFR Section 200.214 requires non-federal entities to follow suspension and debarment regulations outlined in 2 CFR part 180. When a nonfederal entity enters into a covered transaction with an entity at a lower tier, the nonfederal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. Condition: The City did not maintain documentation to support that the required search for suspension and debarment was performed. Questioned Costs: None Context: While performing audit procedures, it was noted that City management did not maintain documentation that a search for suspension and debarment prior to finalizing the procurement was performed. Cause: The City did not have a procedure in place to require documentation be maintained that a search for suspension and department associated with procurement transactions in excess of the $25,000 threshold had been performed. Effect: Certain vendors could be used that are considered suspended or debarred by the federal government resulting in noncompliance. Repeat Finding: No Recommendation: We recommend that the City review its policies over suspension and debarment review to ensure they are maintaining compliance and controls over verifying or contracting with vendors that are allowable. Views of Responsible Officials: There is no disagreement with the audit finding.
Finding No. 2022-004: Procurement Policy ? Material Weakness in Internal Control Over Financial Reporting; U.S. Department of Health and Human Services, Rare Disorders: Research, Surveillance, Health Promotion, and Education; Assistance Listing Number 93.315 Condition There is no evidence of a documented formal procurement policy with regards to federal grant awards and expenditures, no documented support that a competitive price analysis for vendors and organizations funded with federal grant funds were performed and no evidence that suspension and debarment verifications were performed for certain vendors and organizations, as required by the general procurement standards of the Uniform Guidance. Context We selected four samples which were deemed sole sourced by management and noted no written documentation for this conclusion or evidence of suspension or debarment verification being performed was maintained in the file. Based on our discussions with management, they were not aware of the Uniform Guidance requirements with regards to procurement. Criteria Under the Uniform Guidance Section 200.318, General Procurement Standards, a non-Federal entity must have and use documented procurement procedures for the acquisition of property or services required under a Federal award or subaward. The non-Federal entity?s documented procurement procedures must conform to the procurement standards identified in Sections 200.317 through 200.327. These sections include policies and procedures related to competition, informal and formal procurement methods and noncompetitive procurement also known as sole source. Under Uniform Guidance Section 200.214, Suspension and Debarment, and 2 CFR Part 180, non-federal entities are required to verify that vendors are not suspended or debarred from participating in federal funds. Cause Management stated it was not aware of the Uniform Guidance requirements with regards to procurement and, therefore, did not develop a procurement policy that includes the provisions of the general procurement standards required under the Uniform Guidance. Effect Charges relating to vendor services and sub-awards that were charged to the federal award may not be in accordance with the specific compliance requirements of the Uniform Guidance. Questioned Costs $97,078, representing total sub-awards and consulting expenses paid during the year. Repeat Finding No. Recommendation We recommend that the Association establish a written procurement policy governing contracts with vendors that will be reimbursed by federal grants to incorporate all of the provisions included in the general procurement standards of the Uniform Guidance Section 200.318 and the debarment and suspension regulations of Uniform Guidance Section 200.214. We also recommend that a review of all existing vendor or sub-awardee contract files be performed to ensure that the documentation as required under the Uniform Guidance is maintained in the files. Views of Responsible Officials and Planned Corrective Action See corrective action plan.
2022 ? 003 Federal agency: U.S. Department of Health and Human Services Federal program title: Health Centers Cluster Assistance Listing Number: 93.224/93.527 Award Period: Varying project and budget periods: 1/1/22 ? 12/31/22, 4/1/21 ? 3/31/23 Type of Finding: ? Significant Deficiency in Internal Control over Compliance Criteria or specific requirement: The Code of Federal Regulations section 200.214 requires the Organization to follow the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. The Organization should have policies and procedures in place to ensure contracts or subaward are not provided to third parties that are suspended or disbarred. Condition: During our testing, we noted the Organization did follow formal policies and procedures in place to determine if vendors have been suspended or disbarred prior to entering into a contract, however for one of two selections tested the incorrect vendor name was used. Therefore, the internal control did not function as designed and the actual vendor used did not have documentation retained around check for exclusions. Questioned costs: None Context: During our testing, a sample of two disbursement transactions greater than $25,000 were selected for suspension and disbarment testing. The Organization followed procedures in both cases to check vendors against the 'System for Award Management (SAM) Exclusions'. For one of the vendors, however, the incorrect vendor name was used, and therefore incorrect data retained to support the exclusion check. In addition, the incorrect vendor did have a federal exclusion. The vendor the Organization actually used did not have an exclusion. Cause: The finding is just the result of manual error as an acronym was used for the vendor in the search that resulted in a different, incorrect vendor being the search result. Effect: If suspension and debarment policies and procedures are not operating effectively, it provides the opportunity for noncompliance due to transactions with suspended or disbarred parties. Repeat finding: No Recommendation: We recommend the Organization follow the suspension and debarment policy in its new procurement policy and also ensure the correct vendor is being searched via other identification methods besides just vendor name. Views of responsible officials: There is no disagreement with the audit finding.
2022 ? 003 Federal agency: U.S. Department of Health and Human Services Federal program title: Health Centers Cluster Assistance Listing Number: 93.224/93.527 Award Period: Varying project and budget periods: 1/1/22 ? 12/31/22, 4/1/21 ? 3/31/23 Type of Finding: ? Significant Deficiency in Internal Control over Compliance Criteria or specific requirement: The Code of Federal Regulations section 200.214 requires the Organization to follow the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. The Organization should have policies and procedures in place to ensure contracts or subaward are not provided to third parties that are suspended or disbarred. Condition: During our testing, we noted the Organization did follow formal policies and procedures in place to determine if vendors have been suspended or disbarred prior to entering into a contract, however for one of two selections tested the incorrect vendor name was used. Therefore, the internal control did not function as designed and the actual vendor used did not have documentation retained around check for exclusions. Questioned costs: None Context: During our testing, a sample of two disbursement transactions greater than $25,000 were selected for suspension and disbarment testing. The Organization followed procedures in both cases to check vendors against the 'System for Award Management (SAM) Exclusions'. For one of the vendors, however, the incorrect vendor name was used, and therefore incorrect data retained to support the exclusion check. In addition, the incorrect vendor did have a federal exclusion. The vendor the Organization actually used did not have an exclusion. Cause: The finding is just the result of manual error as an acronym was used for the vendor in the search that resulted in a different, incorrect vendor being the search result. Effect: If suspension and debarment policies and procedures are not operating effectively, it provides the opportunity for noncompliance due to transactions with suspended or disbarred parties. Repeat finding: No Recommendation: We recommend the Organization follow the suspension and debarment policy in its new procurement policy and also ensure the correct vendor is being searched via other identification methods besides just vendor name. Views of responsible officials: There is no disagreement with the audit finding.
2022 ? 003 Federal agency: U.S. Department of Health and Human Services Federal program title: Health Centers Cluster Assistance Listing Number: 93.224/93.527 Award Period: Varying project and budget periods: 1/1/22 ? 12/31/22, 4/1/21 ? 3/31/23 Type of Finding: ? Significant Deficiency in Internal Control over Compliance Criteria or specific requirement: The Code of Federal Regulations section 200.214 requires the Organization to follow the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. The Organization should have policies and procedures in place to ensure contracts or subaward are not provided to third parties that are suspended or disbarred. Condition: During our testing, we noted the Organization did follow formal policies and procedures in place to determine if vendors have been suspended or disbarred prior to entering into a contract, however for one of two selections tested the incorrect vendor name was used. Therefore, the internal control did not function as designed and the actual vendor used did not have documentation retained around check for exclusions. Questioned costs: None Context: During our testing, a sample of two disbursement transactions greater than $25,000 were selected for suspension and disbarment testing. The Organization followed procedures in both cases to check vendors against the 'System for Award Management (SAM) Exclusions'. For one of the vendors, however, the incorrect vendor name was used, and therefore incorrect data retained to support the exclusion check. In addition, the incorrect vendor did have a federal exclusion. The vendor the Organization actually used did not have an exclusion. Cause: The finding is just the result of manual error as an acronym was used for the vendor in the search that resulted in a different, incorrect vendor being the search result. Effect: If suspension and debarment policies and procedures are not operating effectively, it provides the opportunity for noncompliance due to transactions with suspended or disbarred parties. Repeat finding: No Recommendation: We recommend the Organization follow the suspension and debarment policy in its new procurement policy and also ensure the correct vendor is being searched via other identification methods besides just vendor name. Views of responsible officials: There is no disagreement with the audit finding.
2022-002 Federal Agency: U.S. Department of Agriculture Federal Program Title: Supplemental Nutrition Assistance Program CFDA Number: 10.561 Award Period: December 1, 2019 through September 30, 2023 Type of Finding: ? Significant Deficiency in Internal Control over Compliance Criteria or specific requirement: The Code of Federal Regulations 2 CFR 200.318(a) states, ?the non-Federal entity must have and use document procurement procedures, consistent with State, local, and tribal laws and regulations and the standards of this section, for the acquisition of property or services required under a Federal award or subaward.? In addition, per the Code of Federal Regulations 2 CFR 200.214, non-Federal entities are subject to the non-procurement debarment and suspension regulations. The regulations restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. Condition: During our testing, we noted the Organization had not adopted a procurement policy and no procurement procedures were performed in selecting contractors. Questioned Costs: None Cause: Procurement policies and procedures were not adopted by the Organization. Effect: The Organization may not have received a competitive bid for services, and may have engaged a suspended or debarred contractor. Repeat Finding: This is not a repeat finding. Recommendation: We recommend the Organization implement necessary internal controls to ensure a competitive bid process is performed, and all vendors are reviewed for suspension and debarment, prior to entering into contracts utilizing federal awards. These internal controls should also include a conflict-of-interest clause with all vendors within contract language. Views of responsible officials: Management agrees with the finding.
2022-003 Federal Agency: U.S. Department of the Treasury Federal Program Title: Coronavirus State and Local Fiscal Recovery Funds CFDA Number: 21.027 Award Period: June 23, 2022 through June 22, 2023 Type of Finding: ? Significant Deficiency in Internal Control over Compliance Criteria or specific requirement: The Code of Federal Regulations 2 CFR 200.318(a) states, ?the non-Federal entity must have and use document procurement procedures, consistent with State, local, and tribal laws and regulations and the standards of this section, for the acquisition of property or services required under a Federal award or subaward.? In addition, per the Code of Federal Regulations 2 CFR 200.214, non-Federal entities are subject to the non-procurement debarment and suspension regulations. The regulations restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. Condition: During our testing, we noted the Organization had not adopted a procurement policy and no procurement procedures were performed in selecting contractors. Questioned Costs: None Cause: Procurement policies and procedures were not adopted by the Organization. Effect: The Organization may not have received a competitive bid for services, and may have engaged a suspended or debarred contractor. Repeat Finding: This is not a repeat finding. Recommendation: We recommend the Organization implement necessary internal controls to ensure a competitive bid process is performed, and all vendors are reviewed for suspension and debarment, prior to entering into contracts utilizing federal awards. These internal controls should also include a conflict-of-interest clause with all vendors within contract language. Views of responsible officials: Management agrees with the finding.
FINDING 2022-004 Subject: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds - Suspension and Debarment Federal Agency: Department of the Treasury Federal Program: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Assistance Listings Number: 21.027 Federal Award Number and Year (or Other Identifying Number): FY 2022 Compliance Requirement: Procurement and Suspension and Debarment Audit Findings: Material Weakness, Modified Opinion Condition and Context The County elected to receive the standard revenue loss allowance, allowing the County to claim its total State and Local Fiscal Recovery Funds (SLFRF) allocation of $4,681,531 as revenue loss to use for government services. As such, all SLFRF program funds were expended under the revenue loss eligible use category. The U.S. Department of the Treasury (Treasury) determined that there are no subawards under this eligible use category, and that recipients' use of revenue loss funds would not give rise to subrecipient relationships given that there is no federal program or purpose to carry out in the case of the revenue loss portion of the award. Prior to entering into subawards and covered transactions with federal award funds, recipients are required to verify that such contracts and subrecipients are not suspended, debarred, or otherwise excluded. "Covered transactions" include, but are not limited to contracts for goods and services awarded under a non-procurement transaction (i.e., grant agreement) that are expected to equal or exceed $25,000. The verification is to be done by checking the Excluded Parties List System (EPLS), collecting a certification from that person, or adding a clause or condition to the covered transaction with that person. Due to the Treasury's determination that the revenue loss eligible use category does not give rise to subawards, the County was only required to comply with suspension and debarment requirements related to covered transactions. Upon inquiry of the County in order to review the procedures in place for verifying that an entity with which it plans to enter into a covered transaction is not suspended, debarred, or otherwise excluded, the County divulged that they were unaware of the suspension and debarment requirements related to the SLFRF awards. A population of three covered transactions for goods or services that equaled or exceeded $25,000 paid from SLFRF funds during the audit period were identified. The three contracts totaled $3,103,878, with payments totaling $1,289,929 during 2022. The County did not verify the vendors' suspension and debarment status prior to payment due to the County not having any policies or procedures in place to verify that contractors were neither suspended nor debarred, or otherwise excluded or disqualified from participating in federal assistance programs or activities. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.214 states: "Non-federal entities and contractors are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities." 31 CFR 19.300 states: "When you enter into a covered transaction with another person at the next lower tier, you must verify that the person with whom you intend to do business is not excluded or disqualified. You do this by: (c) Checking the EPLS; or (b) Collecting a certification from that person if allowed by this rule; or (c) Adding a clause or condition to the covered transaction with that person." Cause A proper system of internal controls was not designed or implemented, which includes segregation of key functions, by management of the County to ensure that policies and procedures were in place related to suspension and debarment. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the County's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, vendors to whom payments equal to or in excess of $25,000 were not verified to be not suspended, debarred, or otherwise excluded. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions or the federal award could result in the loss of future federal funding to the County. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the County establish a proper system of internal controls and develop policies and procedures to ensure contractors and subrecipients, as appropriate are not suspended, debarred, or otherwise excluded prior to entering into any contracts or subawards. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-002 Subject: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds - Suspension and Debarment Federal Agency: Department of the Treasury Federal Program: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Assistance Listings Number: 21.027 Federal Award Number and Year (or Other Identifying Number): 2022 Compliance Requirement: Procurement and Suspension and Debarment Audit Findings: Material Weakness, Modified Opinion Condition and Context The County elected to receive the standard revenue loss allowance, allowing the County to claim up to $10 million of its total State and Local Fiscal Recovery Funds (SLFRF) allocation of $16,273,089 as revenue loss to use for government services. During 2022, the County expended SLFRF award funds in the following categories: Public Health, Revenue Loss, and Infrastructure. The U.S. Department of the Treasury determined there are no subawards under the Revenue Loss eligible use category, and that recipients' use of revenue loss funds would not give rise to subrecipient relationships given there is no federal program or purpose to carry out in the case of the revenue loss portion of the award. Prior to entering into subawards and covered transactions with SLFRF award funds, recipients are required to verify that such contractors and subrecipients are not suspended, debarred, or otherwise excluded. "Covered transactions" include, but are not limited to, contracts for goods and services awarded under a non-procurement transaction (i.e., grant agreement) that are expected to equal or exceed $25,000. The verification is to be done by checking the Excluded Parties List System (EPLS), collecting a certification from that person, or adding a clause or condition to the covered transaction with that person. The County did not have any policies or procedures in place related to the SLFRF suspension and debarment requirements. A population of nine vendors paid from SLFRF funds during the audit period were identified that had transactions which equaled or exceeded $25,000. Three vendors were selected for testing to verify if the County had verified if the vendor was suspended, debarred, or otherwise excluded, prior to entering in the covered transaction. One set of vendor transactions, in the amount of $805,530, was made for the mechanical upgrades to the Bartholomew County Jail. Although bids were obtained, the vendor's suspension and debarment was not verified prior to payment. The second transaction selected for testing in the amount of $44,808 was made for the purchase of a 2022 Chrysler Pacifica van. Several quotes were obtained and maintained; however, the purchase was ultimately made without verifying the vendor's suspension and debarment status. The third set of transactions tested in the amount $476,086 was for the Fairgrounds Water and Sewer project. Although bids were obtained, the suspension and debarment status was not verified prior to payment. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.214 states: "Non-Federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities." 31 CFR 19.300 states: "When you enter into a covered transaction with another person at the next lower tier, you must verify that the person with whom you intend to do business is not excluded or disqualified. You do this by: (a) Checking the EPLS; or (b) Collecting a certification from that person if allowed by this rule; or (c) Adding a clause or condition to the covered transaction with that person." Cause A proper system of internal controls was not designed by management of the County. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the County's management of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, vendors to whom payments equal to or in excess of $25,000 were not verified to be not suspended, debarred, or otherwise excluded. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the County. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the County establish a proper system of internal controls and develop policies and procedures to ensure contractors and subrecipients, as appropriate, are not suspended, debarred, or otherwise excluded prior to entering into any contracts or subawards. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-001 Subject: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds - Suspension and Debarment Federal Agency: Department of the Treasury Federal Program: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Assistance Listings Number: 21.027 Federal Award Number and Year (or Other Identifying Number): 2021 Pass-Through Entity: Direct Grant Compliance Requirement: Procurement and Suspension and Debarment Audit Findings: Material Weakness, Modified Opinion Condition and Context The City elected to receive the standard revenue loss allowance, allowing the City to claim $10,000,000 of its total State and Local Fiscal Recovery Funds (SLFRF) allocation of $16,549,045 as revenue loss to use for government services. All SLFRF program funds expended in 2022 were under the revenue loss eligible use category. The Department of the Treasury (Treasury) determined that there are no subawards under this eligible use category, and that recipients' use of revenue loss funds would not give rise to subrecipient relationships given that there is no federal program or purpose to carry out in the case of the revenue loss portion of the award. Prior to entering into subawards and covered transactions with SLFRF award funds, recipients are required to verify that such contractors and subrecipients are not suspended, debarred, or otherwise excluded. "Covered transactions" include, but are not limited to contracts for goods and services awarded under a non-procurement transaction (i.e. grant agreement) that are expected to equal or exceed $25,000. The verification is to be done by checking the Excluded Parties List System (EPLS), collecting a certification from that person, or adding a clause or condition to the covered transaction with that person. Due to the Treasury's determination that the revenue loss eligible use category does not give rise to subawards, the City was only required to comply with suspension and debarment requirements related to contracts. The City's policies related to SLFRF suspension and debarment requirements included the Board of Public Works completing a review of each bid packet to ensure the bidder submitted a statement indicating if they were not suspended or debarred. Of the 13 transactions that equaled or exceeded $25,000 that were paid from SLFRF funds during the audit period, 2 were selected for testing to verify the City followed its procedures related to suspension and debarment. One transaction in the amount of $278,000 was made for the purchase of a street sweeper for the Street Department. Although bids were obtained for the street sweeper, the vendor's suspension and debarment status was not verified prior to payment. Documentation of the bids received was not presented to the Board of Public Works; therefore, the street sweeper was purchased without the appropriate approval from the City Board. The second transaction selected for testing in the amount of $65,823 was made for the purchase of a Dodge Ram truck for the Street Department. Several quotes were obtained; however, the purchase was ultimately made without verifying the vendor's suspension and debarment status. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.214 states: "Non-federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations . . . restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities." 31 CFR 19.300 states: "When you enter into a covered transaction with another person at the next lower tier, you must verify that the person with whom you intend to do business is not excluded or disqualified. You do this by: (a) Checking the EPLS; or (b) Collecting a certification from that person if allowed by this rule; or (c) Adding a clause or condition to the covered transaction with that person." Cause The system of internal controls as established by management of the City was not properly implemented to ensure that the policies and procedures in place related to suspension and debarment were appropriately followed. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, vendors to whom payments equal to or in excess of $25,000 were not verified to be not suspended, debarred, or otherwise excluded. Noncompliance with the provisions of Federal statutes, regulations, and the terms and conditions of the Federal award could result in the loss of future federal funding to the City. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the City establish a proper system of internal controls, including strengthening their policies and procedures to ensure their compliance with requirements related to suspension and debarment. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
Finding 2022 ? 001 Identification of the federal program: Federal Agency: Department of Health and Human Services Assistance Listing No., Award Name, Award Number and Pass-through Agency: Assistance Listing Award Name Award Number Pass-Through Agency 93.127 Emergency Medical Services For Children 5 U03MC28844-07-00 93.136 Injury Prevention And Control Research And State And Community Based Programs 5 R49CE003074-03-00 93.136 Injury Prevention And Control Research And State And Community Based Programs 1 R01CE003349-01-00 93.136 Injury Prevention And Control Research And State And Community Based Programs 5 R49CE003074-03-00 93.137 Community Programs To Improve Minority Health Grant Program 5 CPIMP201202-02-00 93.242 Mental Health Research Grants 5R01MH117594-04 93.297 Teenage Pregnancy Prevention Program 5 TP1AH000212-02-00 93.297 Teenage Pregnancy Prevention Program 5 TP1AH000212-03-00 93.353 21ST Century Cures Act ? Beau Biden Cancer Moonshot 1U54CA231641-01 93.353 21ST Century Cures Act ? Beau Biden Cancer Moonshot 1U01CA232488-01 93.378 Integrated Care For Kids Model 2B2CMS331798-03-00 Centers for Medicare & Medicaid Services 93.590 Community-Based Child Abuse Prevention Grants G-2223-22-0246 Ohio Children?s Trust Fund 93.837 Cardiovascular Disease Research 5R01HL135103-05 93.837 Cardiovascular Disease Research 5R01HL157491-02 93.838 Lung Disease Research 1R01HL157039-01 93.838 Lung Disease Research 5R01HL157039-02 93.839 Blood Disease And Resources Research 1R01HL157208-01A1 93.846 Arthritis, Musculoskeletal And Skin Disease Research 5R01AR073908-03Assistance Listing Award Name Award Number Pass-Through Agency 93.846 Arthritis, Musculoskeletal And Skin Disease Research 1R01AR078395-01A1 93.846 Arthritis, Musculoskeletal And Skin Disease Research 5R01AR073311-04 93.847 Diabetes, Digestive, And Kidney Disease Extramural Research 1R01DK128088-01A1 93.847 Diabetes, Digestive, And Kidney Disease Extramural Research 5U01DK100866-09 93.855 Allergy And Infectious Disease Research 1R01AI151175-01A1 93.855 Allergy And Infectious Disease Research 5R01AI126890-05 93.855 Allergy And Infectious Disease Research 5R01AI096882-09 93.855 Allergy And Infectious Disease Research 5R01AI146581-02 93.855 Allergy And Infectious Disease Research 5R01AI096882-09 93.855 Allergy And Infectious Disease Research 5R01AI116917-08 93.855 Allergy And Infectious Disease Research 5R01AI114581-07 93.865 Child Health And Human Development Extramural Research 5R01HD095976-03 93.865 Child Health And Human Development Extramural Research 5R01HD091347-04 93.865 Child Health And Human Development Extramural Research 5R01HD098175-02 93.865 Child Health And Human Development Extramural Research 5R01HD100420-02 93.870 Maternal, Infant And Early Childhood Home Visiting Grant 02560511MH0622 93.870 Maternal, Infant And Early Childhood Home Visiting Grant 02560511MH0622 Ohio Department of Health Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) states the following regarding internal control:?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in `Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework,? issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Section 200.214 Suspension and Debarment ?Non-Federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities.? Condition: Nationwide Children?s Hospital (the Corporation) uses a third-party to perform its suspension and debarment checks on a monthly basis. However, we noted the following matters: ? The Corporation did not retain the monthly supporting documentation related to the monthly suspension and debarment check. The suspension and debarment checks performed at year-end were retained. ? The Corporation does not have a process to reconcile the vendor list provided to the thirdparty with the results received from the third-party vendor after the suspension and debarment checks are performed to ensure the listing is complete. ? The third-party vendor does not have a SOC 1 (System and Organization Controls) Report. The Corporation relied on the results of the suspension and debarment checks performed by the third-party vendor without implementing an internal process to ensure the results provided by the third-party vendor were accurate.In addition, the Corporation performs a suspension and debarment check of all new vendors prior to activating them in the procurement system. The Corporation did not consistently maintain supporting documentation to support the vendor was checked for suspension and debarment before the ?new? vendor was set up in the procurement system. Cause: The Corporation does not have internal controls in place to require supporting documentation be maintained over the monthly suspension and debarment checks including documentation of management?s review and approval. The Corporation does not have internal controls in place to review the accuracy of third-party reports and to require a reconciliation between the vendor list sent to the third-party vendor and the results provided by the third-party vendor. The Corporation does not have internal controls in place to require supporting documentation be maintained over the suspension and debarment check performed on new vendors. Effect or potential effect: The Corporation?s vendors may not be screened for suspension and debarment, or the suspension and debarment results may not be accurate. A vendor may be set up in the procurement system that is suspended or debarred. Questioned costs: None Context: We tested a sample of 40 new vendors set up in the procurement system in 2022 and noted four instances where management did not retain the supporting documents of its review of suspension and debarment for the vendor.The federal portion of procurement expenditures subject to suspension and debarment was $10,415,440 which represents approximately 12.3% of the R&D Cluster federal expenditures. The total amount reported on the SEFA for the R&D cluster is $82,409,498. Identification as a repeat finding, if applicable: Not a repeat finding Recommendation: The Corporation should implement the following internal controls: ? The monthly suspension and debarment review process ? Reconciliation of the number of vendor files sent to the third-party vendor with the number of files received from the third-party vendor with the suspension and debarment results and review of the accuracy of the suspension and debarment results performed by the thirdparty vendor ? Maintenance of the supporting documentation over the suspension and debarment checks performed on new vendors
Finding 2022 ? 001 Identification of the federal program: Federal Agency: Department of Health and Human Services Assistance Listing No., Award Name, Award Number and Pass-through Agency: Assistance Listing Award Name Award Number Pass-Through Agency 93.127 Emergency Medical Services For Children 5 U03MC28844-07-00 93.136 Injury Prevention And Control Research And State And Community Based Programs 5 R49CE003074-03-00 93.136 Injury Prevention And Control Research And State And Community Based Programs 1 R01CE003349-01-00 93.136 Injury Prevention And Control Research And State And Community Based Programs 5 R49CE003074-03-00 93.137 Community Programs To Improve Minority Health Grant Program 5 CPIMP201202-02-00 93.242 Mental Health Research Grants 5R01MH117594-04 93.297 Teenage Pregnancy Prevention Program 5 TP1AH000212-02-00 93.297 Teenage Pregnancy Prevention Program 5 TP1AH000212-03-00 93.353 21ST Century Cures Act ? Beau Biden Cancer Moonshot 1U54CA231641-01 93.353 21ST Century Cures Act ? Beau Biden Cancer Moonshot 1U01CA232488-01 93.378 Integrated Care For Kids Model 2B2CMS331798-03-00 Centers for Medicare & Medicaid Services 93.590 Community-Based Child Abuse Prevention Grants G-2223-22-0246 Ohio Children?s Trust Fund 93.837 Cardiovascular Disease Research 5R01HL135103-05 93.837 Cardiovascular Disease Research 5R01HL157491-02 93.838 Lung Disease Research 1R01HL157039-01 93.838 Lung Disease Research 5R01HL157039-02 93.839 Blood Disease And Resources Research 1R01HL157208-01A1 93.846 Arthritis, Musculoskeletal And Skin Disease Research 5R01AR073908-03Assistance Listing Award Name Award Number Pass-Through Agency 93.846 Arthritis, Musculoskeletal And Skin Disease Research 1R01AR078395-01A1 93.846 Arthritis, Musculoskeletal And Skin Disease Research 5R01AR073311-04 93.847 Diabetes, Digestive, And Kidney Disease Extramural Research 1R01DK128088-01A1 93.847 Diabetes, Digestive, And Kidney Disease Extramural Research 5U01DK100866-09 93.855 Allergy And Infectious Disease Research 1R01AI151175-01A1 93.855 Allergy And Infectious Disease Research 5R01AI126890-05 93.855 Allergy And Infectious Disease Research 5R01AI096882-09 93.855 Allergy And Infectious Disease Research 5R01AI146581-02 93.855 Allergy And Infectious Disease Research 5R01AI096882-09 93.855 Allergy And Infectious Disease Research 5R01AI116917-08 93.855 Allergy And Infectious Disease Research 5R01AI114581-07 93.865 Child Health And Human Development Extramural Research 5R01HD095976-03 93.865 Child Health And Human Development Extramural Research 5R01HD091347-04 93.865 Child Health And Human Development Extramural Research 5R01HD098175-02 93.865 Child Health And Human Development Extramural Research 5R01HD100420-02 93.870 Maternal, Infant And Early Childhood Home Visiting Grant 02560511MH0622 93.870 Maternal, Infant And Early Childhood Home Visiting Grant 02560511MH0622 Ohio Department of Health Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) states the following regarding internal control:?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in `Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework,? issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Section 200.214 Suspension and Debarment ?Non-Federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities.? Condition: Nationwide Children?s Hospital (the Corporation) uses a third-party to perform its suspension and debarment checks on a monthly basis. However, we noted the following matters: ? The Corporation did not retain the monthly supporting documentation related to the monthly suspension and debarment check. The suspension and debarment checks performed at year-end were retained. ? The Corporation does not have a process to reconcile the vendor list provided to the thirdparty with the results received from the third-party vendor after the suspension and debarment checks are performed to ensure the listing is complete. ? The third-party vendor does not have a SOC 1 (System and Organization Controls) Report. The Corporation relied on the results of the suspension and debarment checks performed by the third-party vendor without implementing an internal process to ensure the results provided by the third-party vendor were accurate.In addition, the Corporation performs a suspension and debarment check of all new vendors prior to activating them in the procurement system. The Corporation did not consistently maintain supporting documentation to support the vendor was checked for suspension and debarment before the ?new? vendor was set up in the procurement system. Cause: The Corporation does not have internal controls in place to require supporting documentation be maintained over the monthly suspension and debarment checks including documentation of management?s review and approval. The Corporation does not have internal controls in place to review the accuracy of third-party reports and to require a reconciliation between the vendor list sent to the third-party vendor and the results provided by the third-party vendor. The Corporation does not have internal controls in place to require supporting documentation be maintained over the suspension and debarment check performed on new vendors. Effect or potential effect: The Corporation?s vendors may not be screened for suspension and debarment, or the suspension and debarment results may not be accurate. A vendor may be set up in the procurement system that is suspended or debarred. Questioned costs: None Context: We tested a sample of 40 new vendors set up in the procurement system in 2022 and noted four instances where management did not retain the supporting documents of its review of suspension and debarment for the vendor.The federal portion of procurement expenditures subject to suspension and debarment was $10,415,440 which represents approximately 12.3% of the R&D Cluster federal expenditures. The total amount reported on the SEFA for the R&D cluster is $82,409,498. Identification as a repeat finding, if applicable: Not a repeat finding Recommendation: The Corporation should implement the following internal controls: ? The monthly suspension and debarment review process ? Reconciliation of the number of vendor files sent to the third-party vendor with the number of files received from the third-party vendor with the suspension and debarment results and review of the accuracy of the suspension and debarment results performed by the thirdparty vendor ? Maintenance of the supporting documentation over the suspension and debarment checks performed on new vendors
Finding 2022 ? 001 Identification of the federal program: Federal Agency: Department of Health and Human Services Assistance Listing No., Award Name, Award Number and Pass-through Agency: Assistance Listing Award Name Award Number Pass-Through Agency 93.127 Emergency Medical Services For Children 5 U03MC28844-07-00 93.136 Injury Prevention And Control Research And State And Community Based Programs 5 R49CE003074-03-00 93.136 Injury Prevention And Control Research And State And Community Based Programs 1 R01CE003349-01-00 93.136 Injury Prevention And Control Research And State And Community Based Programs 5 R49CE003074-03-00 93.137 Community Programs To Improve Minority Health Grant Program 5 CPIMP201202-02-00 93.242 Mental Health Research Grants 5R01MH117594-04 93.297 Teenage Pregnancy Prevention Program 5 TP1AH000212-02-00 93.297 Teenage Pregnancy Prevention Program 5 TP1AH000212-03-00 93.353 21ST Century Cures Act ? Beau Biden Cancer Moonshot 1U54CA231641-01 93.353 21ST Century Cures Act ? Beau Biden Cancer Moonshot 1U01CA232488-01 93.378 Integrated Care For Kids Model 2B2CMS331798-03-00 Centers for Medicare & Medicaid Services 93.590 Community-Based Child Abuse Prevention Grants G-2223-22-0246 Ohio Children?s Trust Fund 93.837 Cardiovascular Disease Research 5R01HL135103-05 93.837 Cardiovascular Disease Research 5R01HL157491-02 93.838 Lung Disease Research 1R01HL157039-01 93.838 Lung Disease Research 5R01HL157039-02 93.839 Blood Disease And Resources Research 1R01HL157208-01A1 93.846 Arthritis, Musculoskeletal And Skin Disease Research 5R01AR073908-03Assistance Listing Award Name Award Number Pass-Through Agency 93.846 Arthritis, Musculoskeletal And Skin Disease Research 1R01AR078395-01A1 93.846 Arthritis, Musculoskeletal And Skin Disease Research 5R01AR073311-04 93.847 Diabetes, Digestive, And Kidney Disease Extramural Research 1R01DK128088-01A1 93.847 Diabetes, Digestive, And Kidney Disease Extramural Research 5U01DK100866-09 93.855 Allergy And Infectious Disease Research 1R01AI151175-01A1 93.855 Allergy And Infectious Disease Research 5R01AI126890-05 93.855 Allergy And Infectious Disease Research 5R01AI096882-09 93.855 Allergy And Infectious Disease Research 5R01AI146581-02 93.855 Allergy And Infectious Disease Research 5R01AI096882-09 93.855 Allergy And Infectious Disease Research 5R01AI116917-08 93.855 Allergy And Infectious Disease Research 5R01AI114581-07 93.865 Child Health And Human Development Extramural Research 5R01HD095976-03 93.865 Child Health And Human Development Extramural Research 5R01HD091347-04 93.865 Child Health And Human Development Extramural Research 5R01HD098175-02 93.865 Child Health And Human Development Extramural Research 5R01HD100420-02 93.870 Maternal, Infant And Early Childhood Home Visiting Grant 02560511MH0622 93.870 Maternal, Infant And Early Childhood Home Visiting Grant 02560511MH0622 Ohio Department of Health Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) states the following regarding internal control:?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in `Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework,? issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Section 200.214 Suspension and Debarment ?Non-Federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities.? Condition: Nationwide Children?s Hospital (the Corporation) uses a third-party to perform its suspension and debarment checks on a monthly basis. However, we noted the following matters: ? The Corporation did not retain the monthly supporting documentation related to the monthly suspension and debarment check. The suspension and debarment checks performed at year-end were retained. ? The Corporation does not have a process to reconcile the vendor list provided to the thirdparty with the results received from the third-party vendor after the suspension and debarment checks are performed to ensure the listing is complete. ? The third-party vendor does not have a SOC 1 (System and Organization Controls) Report. The Corporation relied on the results of the suspension and debarment checks performed by the third-party vendor without implementing an internal process to ensure the results provided by the third-party vendor were accurate.In addition, the Corporation performs a suspension and debarment check of all new vendors prior to activating them in the procurement system. The Corporation did not consistently maintain supporting documentation to support the vendor was checked for suspension and debarment before the ?new? vendor was set up in the procurement system. Cause: The Corporation does not have internal controls in place to require supporting documentation be maintained over the monthly suspension and debarment checks including documentation of management?s review and approval. The Corporation does not have internal controls in place to review the accuracy of third-party reports and to require a reconciliation between the vendor list sent to the third-party vendor and the results provided by the third-party vendor. The Corporation does not have internal controls in place to require supporting documentation be maintained over the suspension and debarment check performed on new vendors. Effect or potential effect: The Corporation?s vendors may not be screened for suspension and debarment, or the suspension and debarment results may not be accurate. A vendor may be set up in the procurement system that is suspended or debarred. Questioned costs: None Context: We tested a sample of 40 new vendors set up in the procurement system in 2022 and noted four instances where management did not retain the supporting documents of its review of suspension and debarment for the vendor.The federal portion of procurement expenditures subject to suspension and debarment was $10,415,440 which represents approximately 12.3% of the R&D Cluster federal expenditures. The total amount reported on the SEFA for the R&D cluster is $82,409,498. Identification as a repeat finding, if applicable: Not a repeat finding Recommendation: The Corporation should implement the following internal controls: ? The monthly suspension and debarment review process ? Reconciliation of the number of vendor files sent to the third-party vendor with the number of files received from the third-party vendor with the suspension and debarment results and review of the accuracy of the suspension and debarment results performed by the thirdparty vendor ? Maintenance of the supporting documentation over the suspension and debarment checks performed on new vendors
Finding 2022 ? 001 Identification of the federal program: Federal Agency: Department of Health and Human Services Assistance Listing No., Award Name, Award Number and Pass-through Agency: Assistance Listing Award Name Award Number Pass-Through Agency 93.127 Emergency Medical Services For Children 5 U03MC28844-07-00 93.136 Injury Prevention And Control Research And State And Community Based Programs 5 R49CE003074-03-00 93.136 Injury Prevention And Control Research And State And Community Based Programs 1 R01CE003349-01-00 93.136 Injury Prevention And Control Research And State And Community Based Programs 5 R49CE003074-03-00 93.137 Community Programs To Improve Minority Health Grant Program 5 CPIMP201202-02-00 93.242 Mental Health Research Grants 5R01MH117594-04 93.297 Teenage Pregnancy Prevention Program 5 TP1AH000212-02-00 93.297 Teenage Pregnancy Prevention Program 5 TP1AH000212-03-00 93.353 21ST Century Cures Act ? Beau Biden Cancer Moonshot 1U54CA231641-01 93.353 21ST Century Cures Act ? Beau Biden Cancer Moonshot 1U01CA232488-01 93.378 Integrated Care For Kids Model 2B2CMS331798-03-00 Centers for Medicare & Medicaid Services 93.590 Community-Based Child Abuse Prevention Grants G-2223-22-0246 Ohio Children?s Trust Fund 93.837 Cardiovascular Disease Research 5R01HL135103-05 93.837 Cardiovascular Disease Research 5R01HL157491-02 93.838 Lung Disease Research 1R01HL157039-01 93.838 Lung Disease Research 5R01HL157039-02 93.839 Blood Disease And Resources Research 1R01HL157208-01A1 93.846 Arthritis, Musculoskeletal And Skin Disease Research 5R01AR073908-03Assistance Listing Award Name Award Number Pass-Through Agency 93.846 Arthritis, Musculoskeletal And Skin Disease Research 1R01AR078395-01A1 93.846 Arthritis, Musculoskeletal And Skin Disease Research 5R01AR073311-04 93.847 Diabetes, Digestive, And Kidney Disease Extramural Research 1R01DK128088-01A1 93.847 Diabetes, Digestive, And Kidney Disease Extramural Research 5U01DK100866-09 93.855 Allergy And Infectious Disease Research 1R01AI151175-01A1 93.855 Allergy And Infectious Disease Research 5R01AI126890-05 93.855 Allergy And Infectious Disease Research 5R01AI096882-09 93.855 Allergy And Infectious Disease Research 5R01AI146581-02 93.855 Allergy And Infectious Disease Research 5R01AI096882-09 93.855 Allergy And Infectious Disease Research 5R01AI116917-08 93.855 Allergy And Infectious Disease Research 5R01AI114581-07 93.865 Child Health And Human Development Extramural Research 5R01HD095976-03 93.865 Child Health And Human Development Extramural Research 5R01HD091347-04 93.865 Child Health And Human Development Extramural Research 5R01HD098175-02 93.865 Child Health And Human Development Extramural Research 5R01HD100420-02 93.870 Maternal, Infant And Early Childhood Home Visiting Grant 02560511MH0622 93.870 Maternal, Infant And Early Childhood Home Visiting Grant 02560511MH0622 Ohio Department of Health Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) states the following regarding internal control:?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in `Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework,? issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Section 200.214 Suspension and Debarment ?Non-Federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities.? Condition: Nationwide Children?s Hospital (the Corporation) uses a third-party to perform its suspension and debarment checks on a monthly basis. However, we noted the following matters: ? The Corporation did not retain the monthly supporting documentation related to the monthly suspension and debarment check. The suspension and debarment checks performed at year-end were retained. ? The Corporation does not have a process to reconcile the vendor list provided to the thirdparty with the results received from the third-party vendor after the suspension and debarment checks are performed to ensure the listing is complete. ? The third-party vendor does not have a SOC 1 (System and Organization Controls) Report. The Corporation relied on the results of the suspension and debarment checks performed by the third-party vendor without implementing an internal process to ensure the results provided by the third-party vendor were accurate.In addition, the Corporation performs a suspension and debarment check of all new vendors prior to activating them in the procurement system. The Corporation did not consistently maintain supporting documentation to support the vendor was checked for suspension and debarment before the ?new? vendor was set up in the procurement system. Cause: The Corporation does not have internal controls in place to require supporting documentation be maintained over the monthly suspension and debarment checks including documentation of management?s review and approval. The Corporation does not have internal controls in place to review the accuracy of third-party reports and to require a reconciliation between the vendor list sent to the third-party vendor and the results provided by the third-party vendor. The Corporation does not have internal controls in place to require supporting documentation be maintained over the suspension and debarment check performed on new vendors. Effect or potential effect: The Corporation?s vendors may not be screened for suspension and debarment, or the suspension and debarment results may not be accurate. A vendor may be set up in the procurement system that is suspended or debarred. Questioned costs: None Context: We tested a sample of 40 new vendors set up in the procurement system in 2022 and noted four instances where management did not retain the supporting documents of its review of suspension and debarment for the vendor.The federal portion of procurement expenditures subject to suspension and debarment was $10,415,440 which represents approximately 12.3% of the R&D Cluster federal expenditures. The total amount reported on the SEFA for the R&D cluster is $82,409,498. Identification as a repeat finding, if applicable: Not a repeat finding Recommendation: The Corporation should implement the following internal controls: ? The monthly suspension and debarment review process ? Reconciliation of the number of vendor files sent to the third-party vendor with the number of files received from the third-party vendor with the suspension and debarment results and review of the accuracy of the suspension and debarment results performed by the thirdparty vendor ? Maintenance of the supporting documentation over the suspension and debarment checks performed on new vendors
Finding 2022 ? 001 Identification of the federal program: Federal Agency: Department of Health and Human Services Assistance Listing No., Award Name, Award Number and Pass-through Agency: Assistance Listing Award Name Award Number Pass-Through Agency 93.127 Emergency Medical Services For Children 5 U03MC28844-07-00 93.136 Injury Prevention And Control Research And State And Community Based Programs 5 R49CE003074-03-00 93.136 Injury Prevention And Control Research And State And Community Based Programs 1 R01CE003349-01-00 93.136 Injury Prevention And Control Research And State And Community Based Programs 5 R49CE003074-03-00 93.137 Community Programs To Improve Minority Health Grant Program 5 CPIMP201202-02-00 93.242 Mental Health Research Grants 5R01MH117594-04 93.297 Teenage Pregnancy Prevention Program 5 TP1AH000212-02-00 93.297 Teenage Pregnancy Prevention Program 5 TP1AH000212-03-00 93.353 21ST Century Cures Act ? Beau Biden Cancer Moonshot 1U54CA231641-01 93.353 21ST Century Cures Act ? Beau Biden Cancer Moonshot 1U01CA232488-01 93.378 Integrated Care For Kids Model 2B2CMS331798-03-00 Centers for Medicare & Medicaid Services 93.590 Community-Based Child Abuse Prevention Grants G-2223-22-0246 Ohio Children?s Trust Fund 93.837 Cardiovascular Disease Research 5R01HL135103-05 93.837 Cardiovascular Disease Research 5R01HL157491-02 93.838 Lung Disease Research 1R01HL157039-01 93.838 Lung Disease Research 5R01HL157039-02 93.839 Blood Disease And Resources Research 1R01HL157208-01A1 93.846 Arthritis, Musculoskeletal And Skin Disease Research 5R01AR073908-03Assistance Listing Award Name Award Number Pass-Through Agency 93.846 Arthritis, Musculoskeletal And Skin Disease Research 1R01AR078395-01A1 93.846 Arthritis, Musculoskeletal And Skin Disease Research 5R01AR073311-04 93.847 Diabetes, Digestive, And Kidney Disease Extramural Research 1R01DK128088-01A1 93.847 Diabetes, Digestive, And Kidney Disease Extramural Research 5U01DK100866-09 93.855 Allergy And Infectious Disease Research 1R01AI151175-01A1 93.855 Allergy And Infectious Disease Research 5R01AI126890-05 93.855 Allergy And Infectious Disease Research 5R01AI096882-09 93.855 Allergy And Infectious Disease Research 5R01AI146581-02 93.855 Allergy And Infectious Disease Research 5R01AI096882-09 93.855 Allergy And Infectious Disease Research 5R01AI116917-08 93.855 Allergy And Infectious Disease Research 5R01AI114581-07 93.865 Child Health And Human Development Extramural Research 5R01HD095976-03 93.865 Child Health And Human Development Extramural Research 5R01HD091347-04 93.865 Child Health And Human Development Extramural Research 5R01HD098175-02 93.865 Child Health And Human Development Extramural Research 5R01HD100420-02 93.870 Maternal, Infant And Early Childhood Home Visiting Grant 02560511MH0622 93.870 Maternal, Infant And Early Childhood Home Visiting Grant 02560511MH0622 Ohio Department of Health Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) states the following regarding internal control:?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in `Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework,? issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Section 200.214 Suspension and Debarment ?Non-Federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities.? Condition: Nationwide Children?s Hospital (the Corporation) uses a third-party to perform its suspension and debarment checks on a monthly basis. However, we noted the following matters: ? The Corporation did not retain the monthly supporting documentation related to the monthly suspension and debarment check. The suspension and debarment checks performed at year-end were retained. ? The Corporation does not have a process to reconcile the vendor list provided to the thirdparty with the results received from the third-party vendor after the suspension and debarment checks are performed to ensure the listing is complete. ? The third-party vendor does not have a SOC 1 (System and Organization Controls) Report. The Corporation relied on the results of the suspension and debarment checks performed by the third-party vendor without implementing an internal process to ensure the results provided by the third-party vendor were accurate.In addition, the Corporation performs a suspension and debarment check of all new vendors prior to activating them in the procurement system. The Corporation did not consistently maintain supporting documentation to support the vendor was checked for suspension and debarment before the ?new? vendor was set up in the procurement system. Cause: The Corporation does not have internal controls in place to require supporting documentation be maintained over the monthly suspension and debarment checks including documentation of management?s review and approval. The Corporation does not have internal controls in place to review the accuracy of third-party reports and to require a reconciliation between the vendor list sent to the third-party vendor and the results provided by the third-party vendor. The Corporation does not have internal controls in place to require supporting documentation be maintained over the suspension and debarment check performed on new vendors. Effect or potential effect: The Corporation?s vendors may not be screened for suspension and debarment, or the suspension and debarment results may not be accurate. A vendor may be set up in the procurement system that is suspended or debarred. Questioned costs: None Context: We tested a sample of 40 new vendors set up in the procurement system in 2022 and noted four instances where management did not retain the supporting documents of its review of suspension and debarment for the vendor.The federal portion of procurement expenditures subject to suspension and debarment was $10,415,440 which represents approximately 12.3% of the R&D Cluster federal expenditures. The total amount reported on the SEFA for the R&D cluster is $82,409,498. Identification as a repeat finding, if applicable: Not a repeat finding Recommendation: The Corporation should implement the following internal controls: ? The monthly suspension and debarment review process ? Reconciliation of the number of vendor files sent to the third-party vendor with the number of files received from the third-party vendor with the suspension and debarment results and review of the accuracy of the suspension and debarment results performed by the thirdparty vendor ? Maintenance of the supporting documentation over the suspension and debarment checks performed on new vendors
Finding 2022 ? 001 Identification of the federal program: Federal Agency: Department of Health and Human Services Assistance Listing No., Award Name, Award Number and Pass-through Agency: Assistance Listing Award Name Award Number Pass-Through Agency 93.127 Emergency Medical Services For Children 5 U03MC28844-07-00 93.136 Injury Prevention And Control Research And State And Community Based Programs 5 R49CE003074-03-00 93.136 Injury Prevention And Control Research And State And Community Based Programs 1 R01CE003349-01-00 93.136 Injury Prevention And Control Research And State And Community Based Programs 5 R49CE003074-03-00 93.137 Community Programs To Improve Minority Health Grant Program 5 CPIMP201202-02-00 93.242 Mental Health Research Grants 5R01MH117594-04 93.297 Teenage Pregnancy Prevention Program 5 TP1AH000212-02-00 93.297 Teenage Pregnancy Prevention Program 5 TP1AH000212-03-00 93.353 21ST Century Cures Act ? Beau Biden Cancer Moonshot 1U54CA231641-01 93.353 21ST Century Cures Act ? Beau Biden Cancer Moonshot 1U01CA232488-01 93.378 Integrated Care For Kids Model 2B2CMS331798-03-00 Centers for Medicare & Medicaid Services 93.590 Community-Based Child Abuse Prevention Grants G-2223-22-0246 Ohio Children?s Trust Fund 93.837 Cardiovascular Disease Research 5R01HL135103-05 93.837 Cardiovascular Disease Research 5R01HL157491-02 93.838 Lung Disease Research 1R01HL157039-01 93.838 Lung Disease Research 5R01HL157039-02 93.839 Blood Disease And Resources Research 1R01HL157208-01A1 93.846 Arthritis, Musculoskeletal And Skin Disease Research 5R01AR073908-03Assistance Listing Award Name Award Number Pass-Through Agency 93.846 Arthritis, Musculoskeletal And Skin Disease Research 1R01AR078395-01A1 93.846 Arthritis, Musculoskeletal And Skin Disease Research 5R01AR073311-04 93.847 Diabetes, Digestive, And Kidney Disease Extramural Research 1R01DK128088-01A1 93.847 Diabetes, Digestive, And Kidney Disease Extramural Research 5U01DK100866-09 93.855 Allergy And Infectious Disease Research 1R01AI151175-01A1 93.855 Allergy And Infectious Disease Research 5R01AI126890-05 93.855 Allergy And Infectious Disease Research 5R01AI096882-09 93.855 Allergy And Infectious Disease Research 5R01AI146581-02 93.855 Allergy And Infectious Disease Research 5R01AI096882-09 93.855 Allergy And Infectious Disease Research 5R01AI116917-08 93.855 Allergy And Infectious Disease Research 5R01AI114581-07 93.865 Child Health And Human Development Extramural Research 5R01HD095976-03 93.865 Child Health And Human Development Extramural Research 5R01HD091347-04 93.865 Child Health And Human Development Extramural Research 5R01HD098175-02 93.865 Child Health And Human Development Extramural Research 5R01HD100420-02 93.870 Maternal, Infant And Early Childhood Home Visiting Grant 02560511MH0622 93.870 Maternal, Infant And Early Childhood Home Visiting Grant 02560511MH0622 Ohio Department of Health Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) states the following regarding internal control:?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in `Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework,? issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Section 200.214 Suspension and Debarment ?Non-Federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities.? Condition: Nationwide Children?s Hospital (the Corporation) uses a third-party to perform its suspension and debarment checks on a monthly basis. However, we noted the following matters: ? The Corporation did not retain the monthly supporting documentation related to the monthly suspension and debarment check. The suspension and debarment checks performed at year-end were retained. ? The Corporation does not have a process to reconcile the vendor list provided to the thirdparty with the results received from the third-party vendor after the suspension and debarment checks are performed to ensure the listing is complete. ? The third-party vendor does not have a SOC 1 (System and Organization Controls) Report. The Corporation relied on the results of the suspension and debarment checks performed by the third-party vendor without implementing an internal process to ensure the results provided by the third-party vendor were accurate.In addition, the Corporation performs a suspension and debarment check of all new vendors prior to activating them in the procurement system. The Corporation did not consistently maintain supporting documentation to support the vendor was checked for suspension and debarment before the ?new? vendor was set up in the procurement system. Cause: The Corporation does not have internal controls in place to require supporting documentation be maintained over the monthly suspension and debarment checks including documentation of management?s review and approval. The Corporation does not have internal controls in place to review the accuracy of third-party reports and to require a reconciliation between the vendor list sent to the third-party vendor and the results provided by the third-party vendor. The Corporation does not have internal controls in place to require supporting documentation be maintained over the suspension and debarment check performed on new vendors. Effect or potential effect: The Corporation?s vendors may not be screened for suspension and debarment, or the suspension and debarment results may not be accurate. A vendor may be set up in the procurement system that is suspended or debarred. Questioned costs: None Context: We tested a sample of 40 new vendors set up in the procurement system in 2022 and noted four instances where management did not retain the supporting documents of its review of suspension and debarment for the vendor.The federal portion of procurement expenditures subject to suspension and debarment was $10,415,440 which represents approximately 12.3% of the R&D Cluster federal expenditures. The total amount reported on the SEFA for the R&D cluster is $82,409,498. Identification as a repeat finding, if applicable: Not a repeat finding Recommendation: The Corporation should implement the following internal controls: ? The monthly suspension and debarment review process ? Reconciliation of the number of vendor files sent to the third-party vendor with the number of files received from the third-party vendor with the suspension and debarment results and review of the accuracy of the suspension and debarment results performed by the thirdparty vendor ? Maintenance of the supporting documentation over the suspension and debarment checks performed on new vendors
Finding 2022 ? 001 Identification of the federal program: Federal Agency: Department of Health and Human Services Assistance Listing No., Award Name, Award Number and Pass-through Agency: Assistance Listing Award Name Award Number Pass-Through Agency 93.127 Emergency Medical Services For Children 5 U03MC28844-07-00 93.136 Injury Prevention And Control Research And State And Community Based Programs 5 R49CE003074-03-00 93.136 Injury Prevention And Control Research And State And Community Based Programs 1 R01CE003349-01-00 93.136 Injury Prevention And Control Research And State And Community Based Programs 5 R49CE003074-03-00 93.137 Community Programs To Improve Minority Health Grant Program 5 CPIMP201202-02-00 93.242 Mental Health Research Grants 5R01MH117594-04 93.297 Teenage Pregnancy Prevention Program 5 TP1AH000212-02-00 93.297 Teenage Pregnancy Prevention Program 5 TP1AH000212-03-00 93.353 21ST Century Cures Act ? Beau Biden Cancer Moonshot 1U54CA231641-01 93.353 21ST Century Cures Act ? Beau Biden Cancer Moonshot 1U01CA232488-01 93.378 Integrated Care For Kids Model 2B2CMS331798-03-00 Centers for Medicare & Medicaid Services 93.590 Community-Based Child Abuse Prevention Grants G-2223-22-0246 Ohio Children?s Trust Fund 93.837 Cardiovascular Disease Research 5R01HL135103-05 93.837 Cardiovascular Disease Research 5R01HL157491-02 93.838 Lung Disease Research 1R01HL157039-01 93.838 Lung Disease Research 5R01HL157039-02 93.839 Blood Disease And Resources Research 1R01HL157208-01A1 93.846 Arthritis, Musculoskeletal And Skin Disease Research 5R01AR073908-03Assistance Listing Award Name Award Number Pass-Through Agency 93.846 Arthritis, Musculoskeletal And Skin Disease Research 1R01AR078395-01A1 93.846 Arthritis, Musculoskeletal And Skin Disease Research 5R01AR073311-04 93.847 Diabetes, Digestive, And Kidney Disease Extramural Research 1R01DK128088-01A1 93.847 Diabetes, Digestive, And Kidney Disease Extramural Research 5U01DK100866-09 93.855 Allergy And Infectious Disease Research 1R01AI151175-01A1 93.855 Allergy And Infectious Disease Research 5R01AI126890-05 93.855 Allergy And Infectious Disease Research 5R01AI096882-09 93.855 Allergy And Infectious Disease Research 5R01AI146581-02 93.855 Allergy And Infectious Disease Research 5R01AI096882-09 93.855 Allergy And Infectious Disease Research 5R01AI116917-08 93.855 Allergy And Infectious Disease Research 5R01AI114581-07 93.865 Child Health And Human Development Extramural Research 5R01HD095976-03 93.865 Child Health And Human Development Extramural Research 5R01HD091347-04 93.865 Child Health And Human Development Extramural Research 5R01HD098175-02 93.865 Child Health And Human Development Extramural Research 5R01HD100420-02 93.870 Maternal, Infant And Early Childhood Home Visiting Grant 02560511MH0622 93.870 Maternal, Infant And Early Childhood Home Visiting Grant 02560511MH0622 Ohio Department of Health Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) states the following regarding internal control:?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in `Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework,? issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Section 200.214 Suspension and Debarment ?Non-Federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities.? Condition: Nationwide Children?s Hospital (the Corporation) uses a third-party to perform its suspension and debarment checks on a monthly basis. However, we noted the following matters: ? The Corporation did not retain the monthly supporting documentation related to the monthly suspension and debarment check. The suspension and debarment checks performed at year-end were retained. ? The Corporation does not have a process to reconcile the vendor list provided to the thirdparty with the results received from the third-party vendor after the suspension and debarment checks are performed to ensure the listing is complete. ? The third-party vendor does not have a SOC 1 (System and Organization Controls) Report. The Corporation relied on the results of the suspension and debarment checks performed by the third-party vendor without implementing an internal process to ensure the results provided by the third-party vendor were accurate.In addition, the Corporation performs a suspension and debarment check of all new vendors prior to activating them in the procurement system. The Corporation did not consistently maintain supporting documentation to support the vendor was checked for suspension and debarment before the ?new? vendor was set up in the procurement system. Cause: The Corporation does not have internal controls in place to require supporting documentation be maintained over the monthly suspension and debarment checks including documentation of management?s review and approval. The Corporation does not have internal controls in place to review the accuracy of third-party reports and to require a reconciliation between the vendor list sent to the third-party vendor and the results provided by the third-party vendor. The Corporation does not have internal controls in place to require supporting documentation be maintained over the suspension and debarment check performed on new vendors. Effect or potential effect: The Corporation?s vendors may not be screened for suspension and debarment, or the suspension and debarment results may not be accurate. A vendor may be set up in the procurement system that is suspended or debarred. Questioned costs: None Context: We tested a sample of 40 new vendors set up in the procurement system in 2022 and noted four instances where management did not retain the supporting documents of its review of suspension and debarment for the vendor.The federal portion of procurement expenditures subject to suspension and debarment was $10,415,440 which represents approximately 12.3% of the R&D Cluster federal expenditures. The total amount reported on the SEFA for the R&D cluster is $82,409,498. Identification as a repeat finding, if applicable: Not a repeat finding Recommendation: The Corporation should implement the following internal controls: ? The monthly suspension and debarment review process ? Reconciliation of the number of vendor files sent to the third-party vendor with the number of files received from the third-party vendor with the suspension and debarment results and review of the accuracy of the suspension and debarment results performed by the thirdparty vendor ? Maintenance of the supporting documentation over the suspension and debarment checks performed on new vendors
Finding 2022 ? 001 Identification of the federal program: Federal Agency: Department of Health and Human Services Assistance Listing No., Award Name, Award Number and Pass-through Agency: Assistance Listing Award Name Award Number Pass-Through Agency 93.127 Emergency Medical Services For Children 5 U03MC28844-07-00 93.136 Injury Prevention And Control Research And State And Community Based Programs 5 R49CE003074-03-00 93.136 Injury Prevention And Control Research And State And Community Based Programs 1 R01CE003349-01-00 93.136 Injury Prevention And Control Research And State And Community Based Programs 5 R49CE003074-03-00 93.137 Community Programs To Improve Minority Health Grant Program 5 CPIMP201202-02-00 93.242 Mental Health Research Grants 5R01MH117594-04 93.297 Teenage Pregnancy Prevention Program 5 TP1AH000212-02-00 93.297 Teenage Pregnancy Prevention Program 5 TP1AH000212-03-00 93.353 21ST Century Cures Act ? Beau Biden Cancer Moonshot 1U54CA231641-01 93.353 21ST Century Cures Act ? Beau Biden Cancer Moonshot 1U01CA232488-01 93.378 Integrated Care For Kids Model 2B2CMS331798-03-00 Centers for Medicare & Medicaid Services 93.590 Community-Based Child Abuse Prevention Grants G-2223-22-0246 Ohio Children?s Trust Fund 93.837 Cardiovascular Disease Research 5R01HL135103-05 93.837 Cardiovascular Disease Research 5R01HL157491-02 93.838 Lung Disease Research 1R01HL157039-01 93.838 Lung Disease Research 5R01HL157039-02 93.839 Blood Disease And Resources Research 1R01HL157208-01A1 93.846 Arthritis, Musculoskeletal And Skin Disease Research 5R01AR073908-03Assistance Listing Award Name Award Number Pass-Through Agency 93.846 Arthritis, Musculoskeletal And Skin Disease Research 1R01AR078395-01A1 93.846 Arthritis, Musculoskeletal And Skin Disease Research 5R01AR073311-04 93.847 Diabetes, Digestive, And Kidney Disease Extramural Research 1R01DK128088-01A1 93.847 Diabetes, Digestive, And Kidney Disease Extramural Research 5U01DK100866-09 93.855 Allergy And Infectious Disease Research 1R01AI151175-01A1 93.855 Allergy And Infectious Disease Research 5R01AI126890-05 93.855 Allergy And Infectious Disease Research 5R01AI096882-09 93.855 Allergy And Infectious Disease Research 5R01AI146581-02 93.855 Allergy And Infectious Disease Research 5R01AI096882-09 93.855 Allergy And Infectious Disease Research 5R01AI116917-08 93.855 Allergy And Infectious Disease Research 5R01AI114581-07 93.865 Child Health And Human Development Extramural Research 5R01HD095976-03 93.865 Child Health And Human Development Extramural Research 5R01HD091347-04 93.865 Child Health And Human Development Extramural Research 5R01HD098175-02 93.865 Child Health And Human Development Extramural Research 5R01HD100420-02 93.870 Maternal, Infant And Early Childhood Home Visiting Grant 02560511MH0622 93.870 Maternal, Infant And Early Childhood Home Visiting Grant 02560511MH0622 Ohio Department of Health Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) states the following regarding internal control:?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in `Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework,? issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Section 200.214 Suspension and Debarment ?Non-Federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities.? Condition: Nationwide Children?s Hospital (the Corporation) uses a third-party to perform its suspension and debarment checks on a monthly basis. However, we noted the following matters: ? The Corporation did not retain the monthly supporting documentation related to the monthly suspension and debarment check. The suspension and debarment checks performed at year-end were retained. ? The Corporation does not have a process to reconcile the vendor list provided to the thirdparty with the results received from the third-party vendor after the suspension and debarment checks are performed to ensure the listing is complete. ? The third-party vendor does not have a SOC 1 (System and Organization Controls) Report. The Corporation relied on the results of the suspension and debarment checks performed by the third-party vendor without implementing an internal process to ensure the results provided by the third-party vendor were accurate.In addition, the Corporation performs a suspension and debarment check of all new vendors prior to activating them in the procurement system. The Corporation did not consistently maintain supporting documentation to support the vendor was checked for suspension and debarment before the ?new? vendor was set up in the procurement system. Cause: The Corporation does not have internal controls in place to require supporting documentation be maintained over the monthly suspension and debarment checks including documentation of management?s review and approval. The Corporation does not have internal controls in place to review the accuracy of third-party reports and to require a reconciliation between the vendor list sent to the third-party vendor and the results provided by the third-party vendor. The Corporation does not have internal controls in place to require supporting documentation be maintained over the suspension and debarment check performed on new vendors. Effect or potential effect: The Corporation?s vendors may not be screened for suspension and debarment, or the suspension and debarment results may not be accurate. A vendor may be set up in the procurement system that is suspended or debarred. Questioned costs: None Context: We tested a sample of 40 new vendors set up in the procurement system in 2022 and noted four instances where management did not retain the supporting documents of its review of suspension and debarment for the vendor.The federal portion of procurement expenditures subject to suspension and debarment was $10,415,440 which represents approximately 12.3% of the R&D Cluster federal expenditures. The total amount reported on the SEFA for the R&D cluster is $82,409,498. Identification as a repeat finding, if applicable: Not a repeat finding Recommendation: The Corporation should implement the following internal controls: ? The monthly suspension and debarment review process ? Reconciliation of the number of vendor files sent to the third-party vendor with the number of files received from the third-party vendor with the suspension and debarment results and review of the accuracy of the suspension and debarment results performed by the thirdparty vendor ? Maintenance of the supporting documentation over the suspension and debarment checks performed on new vendors
Finding 2022 ? 001 Identification of the federal program: Federal Agency: Department of Health and Human Services Assistance Listing No., Award Name, Award Number and Pass-through Agency: Assistance Listing Award Name Award Number Pass-Through Agency 93.127 Emergency Medical Services For Children 5 U03MC28844-07-00 93.136 Injury Prevention And Control Research And State And Community Based Programs 5 R49CE003074-03-00 93.136 Injury Prevention And Control Research And State And Community Based Programs 1 R01CE003349-01-00 93.136 Injury Prevention And Control Research And State And Community Based Programs 5 R49CE003074-03-00 93.137 Community Programs To Improve Minority Health Grant Program 5 CPIMP201202-02-00 93.242 Mental Health Research Grants 5R01MH117594-04 93.297 Teenage Pregnancy Prevention Program 5 TP1AH000212-02-00 93.297 Teenage Pregnancy Prevention Program 5 TP1AH000212-03-00 93.353 21ST Century Cures Act ? Beau Biden Cancer Moonshot 1U54CA231641-01 93.353 21ST Century Cures Act ? Beau Biden Cancer Moonshot 1U01CA232488-01 93.378 Integrated Care For Kids Model 2B2CMS331798-03-00 Centers for Medicare & Medicaid Services 93.590 Community-Based Child Abuse Prevention Grants G-2223-22-0246 Ohio Children?s Trust Fund 93.837 Cardiovascular Disease Research 5R01HL135103-05 93.837 Cardiovascular Disease Research 5R01HL157491-02 93.838 Lung Disease Research 1R01HL157039-01 93.838 Lung Disease Research 5R01HL157039-02 93.839 Blood Disease And Resources Research 1R01HL157208-01A1 93.846 Arthritis, Musculoskeletal And Skin Disease Research 5R01AR073908-03Assistance Listing Award Name Award Number Pass-Through Agency 93.846 Arthritis, Musculoskeletal And Skin Disease Research 1R01AR078395-01A1 93.846 Arthritis, Musculoskeletal And Skin Disease Research 5R01AR073311-04 93.847 Diabetes, Digestive, And Kidney Disease Extramural Research 1R01DK128088-01A1 93.847 Diabetes, Digestive, And Kidney Disease Extramural Research 5U01DK100866-09 93.855 Allergy And Infectious Disease Research 1R01AI151175-01A1 93.855 Allergy And Infectious Disease Research 5R01AI126890-05 93.855 Allergy And Infectious Disease Research 5R01AI096882-09 93.855 Allergy And Infectious Disease Research 5R01AI146581-02 93.855 Allergy And Infectious Disease Research 5R01AI096882-09 93.855 Allergy And Infectious Disease Research 5R01AI116917-08 93.855 Allergy And Infectious Disease Research 5R01AI114581-07 93.865 Child Health And Human Development Extramural Research 5R01HD095976-03 93.865 Child Health And Human Development Extramural Research 5R01HD091347-04 93.865 Child Health And Human Development Extramural Research 5R01HD098175-02 93.865 Child Health And Human Development Extramural Research 5R01HD100420-02 93.870 Maternal, Infant And Early Childhood Home Visiting Grant 02560511MH0622 93.870 Maternal, Infant And Early Childhood Home Visiting Grant 02560511MH0622 Ohio Department of Health Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) states the following regarding internal control:?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in `Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework,? issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Section 200.214 Suspension and Debarment ?Non-Federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities.? Condition: Nationwide Children?s Hospital (the Corporation) uses a third-party to perform its suspension and debarment checks on a monthly basis. However, we noted the following matters: ? The Corporation did not retain the monthly supporting documentation related to the monthly suspension and debarment check. The suspension and debarment checks performed at year-end were retained. ? The Corporation does not have a process to reconcile the vendor list provided to the thirdparty with the results received from the third-party vendor after the suspension and debarment checks are performed to ensure the listing is complete. ? The third-party vendor does not have a SOC 1 (System and Organization Controls) Report. The Corporation relied on the results of the suspension and debarment checks performed by the third-party vendor without implementing an internal process to ensure the results provided by the third-party vendor were accurate.In addition, the Corporation performs a suspension and debarment check of all new vendors prior to activating them in the procurement system. The Corporation did not consistently maintain supporting documentation to support the vendor was checked for suspension and debarment before the ?new? vendor was set up in the procurement system. Cause: The Corporation does not have internal controls in place to require supporting documentation be maintained over the monthly suspension and debarment checks including documentation of management?s review and approval. The Corporation does not have internal controls in place to review the accuracy of third-party reports and to require a reconciliation between the vendor list sent to the third-party vendor and the results provided by the third-party vendor. The Corporation does not have internal controls in place to require supporting documentation be maintained over the suspension and debarment check performed on new vendors. Effect or potential effect: The Corporation?s vendors may not be screened for suspension and debarment, or the suspension and debarment results may not be accurate. A vendor may be set up in the procurement system that is suspended or debarred. Questioned costs: None Context: We tested a sample of 40 new vendors set up in the procurement system in 2022 and noted four instances where management did not retain the supporting documents of its review of suspension and debarment for the vendor.The federal portion of procurement expenditures subject to suspension and debarment was $10,415,440 which represents approximately 12.3% of the R&D Cluster federal expenditures. The total amount reported on the SEFA for the R&D cluster is $82,409,498. Identification as a repeat finding, if applicable: Not a repeat finding Recommendation: The Corporation should implement the following internal controls: ? The monthly suspension and debarment review process ? Reconciliation of the number of vendor files sent to the third-party vendor with the number of files received from the third-party vendor with the suspension and debarment results and review of the accuracy of the suspension and debarment results performed by the thirdparty vendor ? Maintenance of the supporting documentation over the suspension and debarment checks performed on new vendors
Finding 2022 ? 001 Identification of the federal program: Federal Agency: Department of Health and Human Services Assistance Listing No., Award Name, Award Number and Pass-through Agency: Assistance Listing Award Name Award Number Pass-Through Agency 93.127 Emergency Medical Services For Children 5 U03MC28844-07-00 93.136 Injury Prevention And Control Research And State And Community Based Programs 5 R49CE003074-03-00 93.136 Injury Prevention And Control Research And State And Community Based Programs 1 R01CE003349-01-00 93.136 Injury Prevention And Control Research And State And Community Based Programs 5 R49CE003074-03-00 93.137 Community Programs To Improve Minority Health Grant Program 5 CPIMP201202-02-00 93.242 Mental Health Research Grants 5R01MH117594-04 93.297 Teenage Pregnancy Prevention Program 5 TP1AH000212-02-00 93.297 Teenage Pregnancy Prevention Program 5 TP1AH000212-03-00 93.353 21ST Century Cures Act ? Beau Biden Cancer Moonshot 1U54CA231641-01 93.353 21ST Century Cures Act ? Beau Biden Cancer Moonshot 1U01CA232488-01 93.378 Integrated Care For Kids Model 2B2CMS331798-03-00 Centers for Medicare & Medicaid Services 93.590 Community-Based Child Abuse Prevention Grants G-2223-22-0246 Ohio Children?s Trust Fund 93.837 Cardiovascular Disease Research 5R01HL135103-05 93.837 Cardiovascular Disease Research 5R01HL157491-02 93.838 Lung Disease Research 1R01HL157039-01 93.838 Lung Disease Research 5R01HL157039-02 93.839 Blood Disease And Resources Research 1R01HL157208-01A1 93.846 Arthritis, Musculoskeletal And Skin Disease Research 5R01AR073908-03Assistance Listing Award Name Award Number Pass-Through Agency 93.846 Arthritis, Musculoskeletal And Skin Disease Research 1R01AR078395-01A1 93.846 Arthritis, Musculoskeletal And Skin Disease Research 5R01AR073311-04 93.847 Diabetes, Digestive, And Kidney Disease Extramural Research 1R01DK128088-01A1 93.847 Diabetes, Digestive, And Kidney Disease Extramural Research 5U01DK100866-09 93.855 Allergy And Infectious Disease Research 1R01AI151175-01A1 93.855 Allergy And Infectious Disease Research 5R01AI126890-05 93.855 Allergy And Infectious Disease Research 5R01AI096882-09 93.855 Allergy And Infectious Disease Research 5R01AI146581-02 93.855 Allergy And Infectious Disease Research 5R01AI096882-09 93.855 Allergy And Infectious Disease Research 5R01AI116917-08 93.855 Allergy And Infectious Disease Research 5R01AI114581-07 93.865 Child Health And Human Development Extramural Research 5R01HD095976-03 93.865 Child Health And Human Development Extramural Research 5R01HD091347-04 93.865 Child Health And Human Development Extramural Research 5R01HD098175-02 93.865 Child Health And Human Development Extramural Research 5R01HD100420-02 93.870 Maternal, Infant And Early Childhood Home Visiting Grant 02560511MH0622 93.870 Maternal, Infant And Early Childhood Home Visiting Grant 02560511MH0622 Ohio Department of Health Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) states the following regarding internal control:?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in `Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework,? issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Section 200.214 Suspension and Debarment ?Non-Federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities.? Condition: Nationwide Children?s Hospital (the Corporation) uses a third-party to perform its suspension and debarment checks on a monthly basis. However, we noted the following matters: ? The Corporation did not retain the monthly supporting documentation related to the monthly suspension and debarment check. The suspension and debarment checks performed at year-end were retained. ? The Corporation does not have a process to reconcile the vendor list provided to the thirdparty with the results received from the third-party vendor after the suspension and debarment checks are performed to ensure the listing is complete. ? The third-party vendor does not have a SOC 1 (System and Organization Controls) Report. The Corporation relied on the results of the suspension and debarment checks performed by the third-party vendor without implementing an internal process to ensure the results provided by the third-party vendor were accurate.In addition, the Corporation performs a suspension and debarment check of all new vendors prior to activating them in the procurement system. The Corporation did not consistently maintain supporting documentation to support the vendor was checked for suspension and debarment before the ?new? vendor was set up in the procurement system. Cause: The Corporation does not have internal controls in place to require supporting documentation be maintained over the monthly suspension and debarment checks including documentation of management?s review and approval. The Corporation does not have internal controls in place to review the accuracy of third-party reports and to require a reconciliation between the vendor list sent to the third-party vendor and the results provided by the third-party vendor. The Corporation does not have internal controls in place to require supporting documentation be maintained over the suspension and debarment check performed on new vendors. Effect or potential effect: The Corporation?s vendors may not be screened for suspension and debarment, or the suspension and debarment results may not be accurate. A vendor may be set up in the procurement system that is suspended or debarred. Questioned costs: None Context: We tested a sample of 40 new vendors set up in the procurement system in 2022 and noted four instances where management did not retain the supporting documents of its review of suspension and debarment for the vendor.The federal portion of procurement expenditures subject to suspension and debarment was $10,415,440 which represents approximately 12.3% of the R&D Cluster federal expenditures. The total amount reported on the SEFA for the R&D cluster is $82,409,498. Identification as a repeat finding, if applicable: Not a repeat finding Recommendation: The Corporation should implement the following internal controls: ? The monthly suspension and debarment review process ? Reconciliation of the number of vendor files sent to the third-party vendor with the number of files received from the third-party vendor with the suspension and debarment results and review of the accuracy of the suspension and debarment results performed by the thirdparty vendor ? Maintenance of the supporting documentation over the suspension and debarment checks performed on new vendors
Finding 2022 ? 001 Identification of the federal program: Federal Agency: Department of Health and Human Services Assistance Listing No., Award Name, Award Number and Pass-through Agency: Assistance Listing Award Name Award Number Pass-Through Agency 93.127 Emergency Medical Services For Children 5 U03MC28844-07-00 93.136 Injury Prevention And Control Research And State And Community Based Programs 5 R49CE003074-03-00 93.136 Injury Prevention And Control Research And State And Community Based Programs 1 R01CE003349-01-00 93.136 Injury Prevention And Control Research And State And Community Based Programs 5 R49CE003074-03-00 93.137 Community Programs To Improve Minority Health Grant Program 5 CPIMP201202-02-00 93.242 Mental Health Research Grants 5R01MH117594-04 93.297 Teenage Pregnancy Prevention Program 5 TP1AH000212-02-00 93.297 Teenage Pregnancy Prevention Program 5 TP1AH000212-03-00 93.353 21ST Century Cures Act ? Beau Biden Cancer Moonshot 1U54CA231641-01 93.353 21ST Century Cures Act ? Beau Biden Cancer Moonshot 1U01CA232488-01 93.378 Integrated Care For Kids Model 2B2CMS331798-03-00 Centers for Medicare & Medicaid Services 93.590 Community-Based Child Abuse Prevention Grants G-2223-22-0246 Ohio Children?s Trust Fund 93.837 Cardiovascular Disease Research 5R01HL135103-05 93.837 Cardiovascular Disease Research 5R01HL157491-02 93.838 Lung Disease Research 1R01HL157039-01 93.838 Lung Disease Research 5R01HL157039-02 93.839 Blood Disease And Resources Research 1R01HL157208-01A1 93.846 Arthritis, Musculoskeletal And Skin Disease Research 5R01AR073908-03Assistance Listing Award Name Award Number Pass-Through Agency 93.846 Arthritis, Musculoskeletal And Skin Disease Research 1R01AR078395-01A1 93.846 Arthritis, Musculoskeletal And Skin Disease Research 5R01AR073311-04 93.847 Diabetes, Digestive, And Kidney Disease Extramural Research 1R01DK128088-01A1 93.847 Diabetes, Digestive, And Kidney Disease Extramural Research 5U01DK100866-09 93.855 Allergy And Infectious Disease Research 1R01AI151175-01A1 93.855 Allergy And Infectious Disease Research 5R01AI126890-05 93.855 Allergy And Infectious Disease Research 5R01AI096882-09 93.855 Allergy And Infectious Disease Research 5R01AI146581-02 93.855 Allergy And Infectious Disease Research 5R01AI096882-09 93.855 Allergy And Infectious Disease Research 5R01AI116917-08 93.855 Allergy And Infectious Disease Research 5R01AI114581-07 93.865 Child Health And Human Development Extramural Research 5R01HD095976-03 93.865 Child Health And Human Development Extramural Research 5R01HD091347-04 93.865 Child Health And Human Development Extramural Research 5R01HD098175-02 93.865 Child Health And Human Development Extramural Research 5R01HD100420-02 93.870 Maternal, Infant And Early Childhood Home Visiting Grant 02560511MH0622 93.870 Maternal, Infant And Early Childhood Home Visiting Grant 02560511MH0622 Ohio Department of Health Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) states the following regarding internal control:?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in `Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework,? issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Section 200.214 Suspension and Debarment ?Non-Federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities.? Condition: Nationwide Children?s Hospital (the Corporation) uses a third-party to perform its suspension and debarment checks on a monthly basis. However, we noted the following matters: ? The Corporation did not retain the monthly supporting documentation related to the monthly suspension and debarment check. The suspension and debarment checks performed at year-end were retained. ? The Corporation does not have a process to reconcile the vendor list provided to the thirdparty with the results received from the third-party vendor after the suspension and debarment checks are performed to ensure the listing is complete. ? The third-party vendor does not have a SOC 1 (System and Organization Controls) Report. The Corporation relied on the results of the suspension and debarment checks performed by the third-party vendor without implementing an internal process to ensure the results provided by the third-party vendor were accurate.In addition, the Corporation performs a suspension and debarment check of all new vendors prior to activating them in the procurement system. The Corporation did not consistently maintain supporting documentation to support the vendor was checked for suspension and debarment before the ?new? vendor was set up in the procurement system. Cause: The Corporation does not have internal controls in place to require supporting documentation be maintained over the monthly suspension and debarment checks including documentation of management?s review and approval. The Corporation does not have internal controls in place to review the accuracy of third-party reports and to require a reconciliation between the vendor list sent to the third-party vendor and the results provided by the third-party vendor. The Corporation does not have internal controls in place to require supporting documentation be maintained over the suspension and debarment check performed on new vendors. Effect or potential effect: The Corporation?s vendors may not be screened for suspension and debarment, or the suspension and debarment results may not be accurate. A vendor may be set up in the procurement system that is suspended or debarred. Questioned costs: None Context: We tested a sample of 40 new vendors set up in the procurement system in 2022 and noted four instances where management did not retain the supporting documents of its review of suspension and debarment for the vendor.The federal portion of procurement expenditures subject to suspension and debarment was $10,415,440 which represents approximately 12.3% of the R&D Cluster federal expenditures. The total amount reported on the SEFA for the R&D cluster is $82,409,498. Identification as a repeat finding, if applicable: Not a repeat finding Recommendation: The Corporation should implement the following internal controls: ? The monthly suspension and debarment review process ? Reconciliation of the number of vendor files sent to the third-party vendor with the number of files received from the third-party vendor with the suspension and debarment results and review of the accuracy of the suspension and debarment results performed by the thirdparty vendor ? Maintenance of the supporting documentation over the suspension and debarment checks performed on new vendors