FAC Explorer

Finding 1201133 (2025-002)

Material Weakness Repeat Finding
Requirement
I
Questioned Costs
-
Year
2025
Accepted
2026-03-30
Audit: 395838
Organization: University Settlement Society of New York, Inc. (NY)
Auditor: PKF O'CONNOR DAVIES LLP

AI Summary

  • Core Issue: The organization failed to consistently verify that vendors were not suspended or debarred before engaging in transactions funded by Federal awards.
  • Impacted Requirements: This noncompliance violates the Uniform Grant Guidance (UGG), which mandates verification of vendor eligibility to prevent transactions with ineligible vendors.
  • Recommended Follow-up: Management should establish clear procedures for vendor verification, ensure documentation is maintained, and provide training for procurement staff on compliance requirements.

Finding Text

2025-002 – Noncompliance with Suspension and Debarment Requirements – Significant Deficiency Federal Assistance Listing Number (“FALN”): 10.558 Name of Program or Cluster: Child and Adult Care Food Program Federal Agencies: Department of Agriculture Pass-through Entities: New York State Department of Health (10.558) Compliance Requirement: Procurement and Suspension and Debarment Condition The organization did not consistently verify that vendors were not suspended or debarred from participating in Federal programs prior to entering into covered transactions. The procurement files did not contain documentation demonstrating that the organization verified vendor eligibility through the System for Award Management (“SAM”) or obtained other allowable forms of certification. Criteria Uniform Grant Guidance (“UGG”) (2 CFR 200.214) requires Non-Federal entities to ensure that contractors receiving Federal funds are not suspended or debarred from doing business with the Federal government. Cause The Settlement does not have adequate procedures in place to ensure that suspension and debarment verification is consistently performed and documented prior to awarding contracts or making payments funded by Federal awards. Effect Failure to verify vendor eligibility increases the risk that the organization could enter a transaction with a vendor that is suspended or debarred from participating in Federal programs, which may result in noncompliance with Federal regulations and potential questioned costs. Questioned Costs None Context No questioned costs were identified as no vendors tested were suspended or debarred. Recommendation Management should implement procedures to ensure that suspension and debarment verification is performed and documented for vendors prior to entering into covered transactions funded by Federal awards. Documentation may include evidence of a SAM search, vendor certification, or inclusion of a suspension and debarment clause in applicable contracts. Additionally, management should provide training to staff responsible for procurement to ensure compliance with Federal requirements. Views of Responsible Officials See Corrective Action Plan in Appendix 1

Corrective Action Plan

2025-002: Noncompliance with Suspension and Debarment Requirements The planned corrective action: Immediate: By 4/30/2026, the Managing Director of Finance, the Director of Accounts Payable and Purchasing, and the CFO will meet with all program managers and review this requirement. Program managers will review existing vendors paid with federal funds and verify they are not on a suspended or barred list. They will then print this screenshot to document and affirm that the vendor is not prohibited. This documentation will then be attached to a request for payment. This step will be added to the manual check list rolling out by 4/30/26 and provided to all purchasers and approvers. Medium Term: In FY26, University Settlement is reviewing and updating its financial policies and will roll these out for approval and implementation by the close of FY26. There will also be formal communication and training provided to finance and program managers. The name(s) of the contact person(s) responsible for corrective action: Lisa Stein, CFO Julia Kagan, Managing Director, Finance Virginia Viloria, Director, Accounts Payable and Purchasing The anticipated completion date for the corrective action. 6/30/2026

Categories

No categories assigned yet.

Other Findings in this Audit

  • 1201130 2025-001
    Material Weakness Repeat
  • 1201131 2025-002
    Material Weakness Repeat
  • 1201132 2025-001
    Material Weakness Repeat
  • 1201134 2025-003
    Material Weakness Repeat
  • 1201135 2025-003
    Material Weakness Repeat
  • 1201136 2025-003
    Material Weakness Repeat
  • 1201137 2025-003
    Material Weakness Repeat
  • 1201138 2025-003
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
84.044 TRIO TALENT SEARCH $647,024
93.569 COMMUNITY SERVICES BLOCK GRANT $439,098
10.558 CHILD AND ADULT CARE FOOD PROGRAM $331,421
93.600 HEAD START $239,134
93.045 SPECIAL PROGRAMS FOR THE AGING, TITLE III, PART C, NUTRITION SERVICES $146,404
84.002 ADULT EDUCATION - BASIC GRANTS TO STATES $144,137
93.667 SOCIAL SERVICES BLOCK GRANT $93,512
45.024 PROMOTION OF THE ARTS GRANTS TO ORGANIZATIONS AND INDIVIDUALS $40,000
93.575 CHILD CARE AND DEVELOPMENT BLOCK GRANT $21,285
93.053 NUTRITION SERVICES INCENTIVE PROGRAM $15,217
93.043 SPECIAL PROGRAMS FOR THE AGING, TITLE III, PART D, DISEASE PREVENTION AND HEALTH PROMOTION SERVICES $3,682