Finding Text
Condition:
During our audit, we were unable to obtain documentation to support the Organization entering into contractual agreements with vendors who were not debarred or suspended from doing business with the Federal government.
Criteria:
Per Uniform Guidance, Non-Federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. “Covered transactions” include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215.
Cause:
Management did not maintain the documentation to support their review and verification of vendors/contractors to determine they were not suspended, debarred, or otherwise excluded before contracting.
Effect:
The Organization does not have adequate documentation on whether they have entered into transactions with eligible entities and is in compliance with Federal guidelines.
Questioned Costs:
Unknown
Recommendation:
We recommend the Organization ensure a process to document and retain support on verification that entities are not suspended, debarred, or otherwise excluded annually at the time of award.
Auditee Response and Corrective Action Plan:
Management agrees with the finding. Refer to the Corrective Action Plan.
Auditor’s Conclusion:
Finding remains as stated.