Finding Text
Item 2024-002 - Procurement, Suspension and Debarment - U.S. Department of Health and Human Services, Substance Abuse and Mental Health Services Projects of Regional and National Significance (Assistance Listing Number 93.243).
Criteria: The U.S. Department of Health and Human Services regulations published in 45 CFR part 76 indicates that organizations or individuals that are suspended, debarred, declared ineligible, or voluntarily excluded from eligibility for covered transactions by any Federal department or agency cannot, during the period of suspension, debarment, or exclusion, receive HHS grants or be paid from HHS grant funds. The U.S. Department of Health and Human Services Grants Policy Statement further indicates that such unallowable charges include salaries paid to individuals who are suspended or debarred.
Condition: The Center did not maintain documentation of its verification of two sample employees and two sample vendors to ascertain if they are suspended or debarred.
Cause: The Center did not have a policy to maintain documentation when the verification result turned out to be negative, i.e., the individual or organization being verified for suspension or debarment is not suspended or debarred.
Effect: The design of the control over compliance is not effective as there is no documentation that such verification was indeed performed.
Questioned Costs: None.
Context: When performing our audit, we tested a sample of two newly-hired employees and two new vendors. There was no evidence of verification on file for all of the samples tested.
Identification of Repeat Finding: Not a repeat finding.
Recommendation: We recommend that the Organization implement a policy requiring proper documentation of their verification of employees and vendors for suspension and debarment.
View of Responsible Official: Management agrees that evidence of exclusion search was not maintained or kept on file. Management has already established a policy in relation to performing verification for suspension and debarment and the Organization will be training all the personnel involved to ensure that proper documentation is kept on file.