Finding Text
2024-002 – Suspension and Debarment
Finding Type. Immaterial Noncompliance; Significant Deficiency in Internal Controls over Compliance.
Federal program(s)
U.S. Department of Agriculture -
Soil & Water Conservation (ALN 10.902); Direct award; All project numbers.
U.S. Department of Commerce -
Congressionally Identified Awards and Projects (ALN 11.469); Direct award.
U.S. Department of the Interior -
Great Lakes Restoration (ALN 15.662); Direct award; All project numbers.
Criteria. Under the requirements of 2 CFR Part 180 covered transactions for procurement and
nonprocurement contracts that are expected to equal or exceed $25,000, the grantee must verify that the
party being awarded a procurement and nonprocurement contract is not suspended, debarred, or otherwise
excluded by checking the list of excluded parties, obtaining certification from the vendor or subrecipient, or
including a clause or condition to the covered transaction with that entity.
Condition. During our testing it was noted that seven out of nine nonprocurement contracts for
subrecipients and three out of three procurement contracts for vendors did not provide evidence that the
respective vendors or subrecipients were not suspended, debarred, or otherwise excluded at the time the
Commission entered into the covered transactions.
Cause. The Commission does not have the proper internal controls in place to ensure that the appropriate
procedures are being followed for covered transactions in accordance with the requirements of the Uniform
Guidance.
Effect. The failure to monitor suspension and debarment could cause the Commission to enter into covered
transactions with vendors who are not eligible to have goods or services purchased with federal monies and
to subrecipients who are not eligible to receive subawards. Upon review of the excluded parties listing
subsequent to year end, it was determined that none of the parties that were awarded either procurement
or nonprocurement contracts were excluded parties.
Questioned Costs. None.
Recommendation. We recommend that the Commission review its procedures for issuing contracts ensure
that the appropriate suspension and debarment evidence of verifications are retained for all vendors
providing goods or services and subrecipients receiving subawards in excess of $25,000. The recommended
best practice is to include a certification verifying suspension and debarment in every contract funded by
federal dollars with every vendor or subrecipient to ensure compliance.
View of Responsible Officials. Management concurs with the finding. The Commission will ensure that all future contracts include certification language verifying suspension and debarment and will also collect separate certificates verifying suspension and debarment from current covered transactions where the certification was omitted from the contract in error. Management has continued its practice of checking suspension and debarment for covered transactions annually in preparation for the audit and notes that none of the Commission's vendors or subrecipients that were awarded contracts were excluded parties.