Finding Text
Finding No.: 2023-003 Federal Agency: U.S. Department of Commerce AL Program: 11.482 Coral Reef Preservation Program Federal Award Nos.: NA20NOS4820198, NA20NOS4820046 Area: Procurement and Suspension and Debarment Questioned Costs: $57,750 Criteria: In accordance with 2 CFR 200.214, non-Federal entities are subject to the non-procurement debarment and suspension regulations implementing 2 CFR 180. Such regulation restricts awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. Under 2 CFR 180.300, when entering into a covered transaction with another person at the next lower tier, verification must be made that the person with whom an intent to do business with is not excluded or disqualified. Such verification can be made by (a) checking SAM Exclusions, (b) collecting a certification from that person; or (c) adding a clause or condition to the covered transaction with that person. Condition: For all three (3) transactions (or 100%) tested amounting in total to $57,750, the Trust could not provide written evidence that prior to entering a covered transaction, the vendor or contractor has not been debarred, suspended, or otherwise excluded from participating in the contract. Cause: The Trust has no procedures to verify whether individuals or contractors are suspended or debarred prior to entering into a covered transaction. Likewise, the Trust does not have written documentation proving prior to entering into a contract, that the vendor was deemed not to be debarred or suspended. Effect: The Trust is in noncompliance with applicable suspension and debarment requirements. Questioned costs of $57,750 is reported. Identified as a Repeat Finding: Finding No. 2022-001 Recommendation: The Trust should revisit and implement formal procedures to document written evidence that, prior to entering into a covered transaction, a search had been performed to ensure the potential individual or contractor is not suspended, debarred, or otherwise excluded. Procedures performed should be adequately maintained in the procurement files. Views of Responsible Officials: Management agrees with the finding. See separate Corrective Action Plan.