Finding Text
2025-003 – Procurement, Suspension, and Debarment (repeat) Finding Type. Immaterial Noncompliance/Material Weakness in Internal Control over Compliance (Procurement, Suspension, and Debarment) Program. Highway Planning and Construction; Passed through Michigan Department of Transportation; Assistance Listing Number 20.205; All Award Numbers. Criteria. Federal regulations require that non-federal entities ensure that vendors are not suspended or debarred and that procurement transactions are conducted in a manner providing full and open competition, including maintaining documentation to support procurement decisions and executed contracts. Condition. During our testing of procurement, suspension and debarment, we noted certain procedures were not consistently performed or documented. This included an instance where the Commission did not verify that a vendor was not suspended or debarred, instances where sole source vendor selections were made without formal documentation supporting the basis for the determination or approval, and instances where executed contracts or agreements were not maintained. Cause. These conditions are attributable to insufficient documentation requirements and oversight related to procurement activities and vendor verification procedures. Effect. As a result, there is an increased risk of noncompliance with federal procurement requirements, including the use of vendors that may be suspended or debarred and insufficient support for procurement decisions, which reduces transparency and accountability. Questioned Costs. No costs were required to be questioned as a result of this finding. Recommendation. We recommend that the Commission implement procedures to ensure vendors are verified against suspension and debarment requirements, that all sole source procurement decisions are formally documented and approved, and that executed contracts and agreements are maintained for all applicable transactions. View of Responsible Officials. Management will implement procedures to strengthen procurement documentation, including vendor verification, sole source justification, and retention of executed agreements.