Finding Text
Section III - Federal Awards Findings and Questioned Costs
Item 2024-003 - Procurement, Suspension and Debarment - U.S. Department of Health and Human Services, Unaccompanied Alien Children Program (Assistance Listing Number 93.676), FAIN # 90ZU0385, 90ZU0603, 90ZU0567, and 90ZU0536, for FY 2024 - Significant Deficiency
Criteria
Recipients and subrecipients are subject to the procurement, debarment and suspension regulations implementing Executive Orders 12549 and 12689, as well as 2 CFR part 180. The regulations in 2 CFR part 180 restrict making Federal awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from receiving or participating in Federal awards. The Agency's policy is that all contracts with new vendors shall require the vendor to certify in writing that it has not been suspended or debarred from doing business with a federal agency. Alternatively, they can research potential vendors on the Excluded parties list. For potential new hires, the Agency performs a check to verify that the potential hiree is not debarred by searching SAM.gov and filing this in the employee's personnel file maintained with Human Resources.
Statement of Condition
During our audit, we noted that certain vendors have no record of an exclusion search conducted in fiscal year 2024. There was also one employee for whom there was no record of an exclusion search. None of the employees or vendors tested were debarred or suspended.
Cause
Inconsistent application of the internal control.
Effect
Failure to timely verify that a vendor or employee is not suspended or debarred could result in entering into a contract with an entity that is barred from performing work for the U.S. government.
Questioned Costs
None
Context
Five out of six samples of new vendors and one out of five new hires tested did not have support for exclusion searches maintained on file during fiscal year 2024.
Identification as a repeat finding
This is not a repeat finding.
Recommendation
We recommend that the Agency train its personnel in relation to the exclusion screening and proper documentation thereof and that the Agency conduct regular reviews to ensure the completeness of exclusion search documentation.
Management response
As per the Purchasing policy, new vendors are sanctioned by the Purchasing department prior to the creation of a purchase order. Compliance conducts a monthly sanction review of all vendors. We have now conducted sanction checks for the vendors that were previously missed and have reinforced the process to ensure that sanction screenings are performed for all newly added vendors moving forward.
In addition, employees whose salaries are charged to federal grants are also subject to suspension and debarment checks. The Agency ensures to actively conduct these checks in compliance with federal regulations.