Finding 1179571 (2025-006)

Federal Agency: • U.S. Department of Agriculture • U.S. Department of Health and Human Services Federal Program Titles: • WIC Special Supplemental Nutrition Program for Women, Infants, and Children • Centers for Disease Control and Prevention Collaboration with Academia to Strengthen Public Health Assistance Listing Numbers: • 10.557 • 93.967 Award Periods: • 265NM504W1003-256NM504W1006 (10/1/2024 - 9/30/2025) (10.557) • NE11OE000056 (12/1/2022 – 11/30/2027) (93.967) Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Criteria or Specific Requirement: 2 CFR Part 200 Uniform Administrative Requirements, Post Federal Award Requirements and Cost Principles for Federal Award requires compliance with the provisions of procurement and suspension and debarment. The Department should have internal controls designed to ensure compliance with these provisions. Condition: During our testing we noted the following: • 10.557 - For one of five procurement transactions tested, the Department was unable to provide documentation supporting they verified the vendor was not suspended or debarred prior to entering into the covered transaction. • 93.967 - For one of four procurement transactions tested, the Department was unable to provide documentation supporting they verified the vendor was not suspended or debarred prior to entering into the covered transaction. 2025-006 (2024-003) Procurement, Suspension, and Debarment (Significant Deficiency, Other Noncompliance) (Continued) While the Department has improved its efforts, there are still opportunities for improvement to reasonably ensure compliance with federal laws, regulations, and program compliance requirements as well as Department policy. Questioned Costs: None Cause: Policies and procedures were not well defined or communicated to staff to ensure suspension and debarment requirements are met prior to entering into a contract with vendors. Effect: The Department was not in compliance with federal procurement, suspension, and debarment requirements. Continued noncompliance can result in sanctions by the federal awarding agency, including withholding future funding. Repeat Finding: Yes Recommendation: We recommend the Department provide additional training to ensure employees are properly completing the suspension and debarment checks prior to finalizing agreements with vendors. Agency Response: The Department acknowledges this finding and provides the following corrective action plan to prevent future findings. As a result of previous audit findings, the department engaged with Deloitte Consulting. Deloitte Consulting provided state road maps for financial controls and process improvements. These will help to develop policy and procedures to ensure that all procurement policies are implemented. The Department has implemented procedures to ensure federal procurement requirements are met and suspension and debarment checks are completed prior to finalizing agreements with vendors. The Department will provide training on the steps needed for verification of debarment and suspensions on sam.gov for applicable procurements and keep on file and/or attach to the purchase order submission in SHARE to assure the division did their due diligence to fulfill this requirement. The Department is working on remediation of this finding and anticipates completion before June 30, 2026. This action plan will comply with 2 CFR Part 200 Uniform Administrative Requirements, Post Federal Award Requirements and Cost Principles for Federal Award. Responsible Persons: Chief Procurement Officer, Federal Grant Director, and Division Finance Directors.