FAC Explorer

Finding 1191188 (2025-002)

Material Weakness Repeat Finding
Requirement
I
Questioned Costs
-
Year
2025
Accepted
2026-03-27
Audit: 395320
Organization: MARY'S PLACE SEATTLE (WA)
Auditor: CLARK NUBER P S

AI Summary

  • Core Issue: The Organization failed to conduct required suspension and debarment checks before entering into three out of four covered transactions.
  • Impacted Requirements: This oversight violates 2 CFR Part 180 regulations, which mandate timely checks to avoid engaging with excluded parties.
  • Recommended Follow-Up: Integrate suspension and debarment procedures into procurement policies to ensure compliance with federal guidelines.

Finding Text

Significant deficiency in internal control over compliance related to suspension and debarment. Federal Agency: Department of Housing and Urban Development Program Title: Economic Development Initiative, Community Project Funding, and Miscellaneous Grants Assistance Listing Number: 14.251 Awards Number: B-24-CP-WA-2268 Award Period: 08/13/2024 - 08/31/2032 Criteria The regulations in 2 U.S. Code of Federal Regulations (CRF) Part 180 – OMB Guidelines to Agencies on Government-Wide Debarment and Suspension (2.CFR.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. Condition/Context for Evaluation For the year ended June 30, 2025, the Organization did not perform suspension and debarment requirements prior to, or at the time of, entering into the transaction for three out of four covered transactions selected for testing as part of the audit. Instead, suspension and debarment checks were performed after the covered transaction occurred. Cause The Organization did not have internal controls in place to ensure suspension and debarment checks were occurring timely. Effect or potential effect The Organization did not fully comply with the suspension and debarment requirements regarding covered transactions. Questioned costs No questioned costs were determined as covered transactions did not occur with suspended or debarred parties based on post transaction analysis. Repeat audit finding No. Recommendation We recommend that the Organization ensure suspension and debarment procedures are incorporated into their procurement policy and are completed timely in accordance with 2.CFR.180. Views of responsible officials Management concurs with the finding and has provided the accompanying management corrective action plan.

Corrective Action Plan

Significant Deficiency in Internal Control Over Compliance – Suspension and Debarment Contact Persons: Chief Financial Officer – Robert te Winkel, rtewinkel@marysplaceseattle.org Controller – Dzhennet Bird dbird@marysplaceseattle.org Senior Accountant - Robin Sing vsing@marysplaceseattle.org Corrective Action Plan: Management concurs with the finding. Mary’s Place has strengthened its suspension and debarment compliance procedures consistent with 2 CFR Part 180 and Uniform Guidance requirements. The enhanced controls are now embedded in procurement activities, with final documentation alignment concluding by February 28, 2026. 1. Mandatory Pre-Award SAM.gov Verification (Preventive Control) For all covered federal transactions, the Controller (or designated finance staff) performs and documents a SAM.gov verification prior to contract execution and prior to release of the initial payment. Verification is completed at the time the vendor is selected and before signature of any federally funded contract. Documentation includes a date-stamped screenshot retained in the vendor file. 2. Executive-Level Review Prior to Execution (Oversight Control) As part of the accounts payable process, the CFO reviews procurement documentation for federally funded contracts prior to the first payment to confirm that SAM.gov verification was completed and properly documented. No payment is released without evidence of verification on file. This creates a secondary compliance checkpoint independent of the initial verification. 3. Documentation Retention and Ongoing Monitoring On a quarterly basis, CFO performs a spot check of federally funded contracts executed during the period to confirm: • SAM.gov verification occurred prior to execution • Documentation is complete and retained • No payments were issued prior to verification Any exceptions are documented and addressed promptly. Anticipated Completion Date: February 28, 2026 (final documentation alignment and full operational rollout; ongoing monitoring thereafter).

Categories

Procurement, Suspension & Debarment

Programs in Audit

ALN Program Name Expenditures
14.251 ECONOMIC DEVELOPMENT INITIATIVE, COMMUNITY PROJECT FUNDING, AND MISCELLANEOUS GRANTS $1.00M
21.027 CORONAVIRUS STATE AND LOCAL FISCAL RECOVERY FUNDS $85,117
14.218 COMMUNITY DEVELOPMENT BLOCK GRANTS/ENTITLEMENT GRANTS $37,332