Finding 1157365 (2024-003)

Finding number 2024-003, significant deficiency in internal controls over compliance - procurement Federal Agency: U.S. Department of Justice Federal Program: Justice Reinvestment Initiative, ALN 16.827 Criteria: In accordance with 2 CFR section 180.300 and 2 CFR section 200.214, nonfederal entities are required to verify that contractors and subrecipients are not suspended or debarred or otherwise excluded from participation in federal programs. This verification can be accomplished by checking the System for Award Management (SAM) Exclusions, collecting a certification from the entity or adding a clause or condition to the covered transaction with that entity. Condition: We noted the Organization did not maintain documentation evidencing that suspension and debarment checks were performed prior to entering into covered transactions with vendors. Cause: Inadequate procedures to ensure suspension and debarment checks were documented prior to entering into covered transactions with vendors. Effect: There is an increased risk that federal funds could be disbursed to vendors who are suspended or debarred from participation in federal programs which could result in the disallowance of costs and require funds to be returned. Questioned Costs: None Recommendation: We recommend that the Organization implement one of the following procedures to verify and document that vendors are not on the suspended or debarred list: 1) checking the System for Award Management (SAM) Exclusions and maintaining a printout of that as documentation of the check; 2) collecting a separately executed certification from the entity or 3) adding a clause to the consulting agreement with the vendor. Views of Responsible Officials: Management concurs with this finding. See Corrective Action Plan