Finding Text
Department of Health and Human Services Federal Financial Assistance Listing #93.829 Section 223 Demonstration Programs to Improve Community Mental Health Services Procurement, Suspension, and Debarment Material Weakness in Internal Control over Compliance Criteria – Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) requires that a non-Federal entity must use its own documented procurement procedures which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal law and standards. The OMB Compliance Supplement states that non-Federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. Non-Federal entities may verify that a party is not suspended or debarred by checking the Excluded Parties List System, collecting a certification from the entity, or adding a clause or condition to the covered transaction. Condition – The Organization did not maintain documentation as required over suspension and debarment prior to entering into the contract. Cause – The Organization did not have adequate internal controls to ensure contracts under Federal awards contained all of the applicable provisions and to ensure suspension and debarment verification procedures were performed prior to entering into all covered transactions. Effect – Procurements could be made to contractors and/or vendors who were suspended or debarred. Questioned Costs – None Context/Sampling – A nonstatistical sample of three from a population of three was selected for testing. The documentation over suspension and debarment was not maintained for two of the transactions tested. Repeat Finding from Prior Year(s) – No Recommendation – We recommend the Organization implement controls, to ensure suspension and debarment procedures and contracts are updated to conform with federal requirements. Views of Responsible Officials – Management agrees with the finding.