FAC Explorer

Finding 1224614 (2024-005)

Material Weakness Repeat Finding
Requirement
I
Questioned Costs
-
Year
2024
Accepted
2026-07-24
Audit: 407853
Organization: Knoxville Knox County Community Action Committee (TN)
Auditor: CLIFTONLARSONALLEN LLP

AI Summary

  • Core Issue: Internal controls for verifying vendor suspension and debarment were not effectively documented before transactions.
  • Impacted Requirements: Compliance with 2 CFR § 200.214 and 2 CFR § 180.300, which mandate verification of vendor status.
  • Recommended Follow-Up: Enhance procurement compliance controls to ensure proper documentation of vendor verification prior to transactions.

Finding Text

Suspension and Debarment Federal Agency: U.S. Department of the Treasury Federal Program Name: Coronavirus State and Local Fiscal Recovery Funds Federal Award Identification Number and Year: 1505-0271 2022 Pass-Through Agency: Knox County, Tennessee; City of Knoxville, Tennessee Pass-Through Number: 24.471; C-22-0147 Assistance Listing Number: 21.027 Award Period: July 1, 2023 – June 30, 2024 Type of Finding: - Significant Deficiency in Internal Control over Compliance Criteria or specific requirement: Pursuant to 2 CFR § 200.214, non-Federal entities are prohibited from entering into covered transactions with parties that are suspended or debarred. In addition, 2 CFR § 180.300 requires non-Federal entities to verify that a vendor or contractor is not suspended or debarred prior to entering into a covered transaction. Condition: CLA selected five contracts to test controls and compliance. Of the five contracts tested, we noted one instance in which the Entity did not maintain evidence that the vendor had been verified for suspension and debarment prior to entering into the transaction. Questioned costs: None Context: Evidence that internal controls are designed effectively and implemented should be appropriately documented and maintained to allow for review during the audit process. Without this evidence the auditor is unable to verify these internal controls were designed effectively and implemented. Cause: Knox CAC’s internal control procedures related to procurement compliance were not designed or operating effectively to ensure that suspension and debarment verification was documented prior to entering into covered transactions. Specifically, there was not an effective review or monitoring control in place to confirm that documentation of the verification was retained in the procurement file. Effect: Failure to document suspension and debarment verification increases the risk that the Entity could enter into a covered transaction with a vendor that is suspended or debarred, resulting in potential noncompliance with Federal requirements. Although no noncompliance was identified in this instance because the vendor was not suspended or debarred, the lack of documented verification represents a significant deficiency in internal control over compliance. Repeat Finding: This is not a repeat finding Recommendation: We recommend that management strengthen internal controls over procurement compliance to ensure suspension and debarment verification is performed and documented prior to entering into covered transactions under Federal programs. Views of responsible officials: There is no disagreement with the audit finding.

Corrective Action Plan

Suspension and Debarment Recommendation: We recommend that management strengthen internal controls over procurement compliance to ensure suspension and debarment verification is performed and documented prior to entering into covered transactions under Federal programs. Explanation of disagreement with audit finding: CAC does not disagree with the audit finding. Action taken in response to finding: Management acknowledges the deficiency related to documenting suspension and debarment verification for covered transactions under Federal programs. Documentation evidencing the verification was not consistently retained. During FY2026, CAC implemented enhanced procurement procedures to ensure suspension and debarment verification is documented and retained for all applicable covered transactions. Corrective actions implemented include: • Verification of covered vendors through the System for Award Management prior to entering into covered transactions, as required by 2 CFR Part 200 • Documentation of the verification date and results in the procurement file • Implementation of a standardized procurement checklist requiring completion of suspension and debarment verification before contract execution or purchase • Supervisory review of procurement files to ensure required documentation has been completed and retained • Training of Finance and purchasing staff on Federal procurement requirements related to suspension and debarment verification Management believes these procedures strengthen procurement controls and provide sufficient documentation demonstrating compliance with Federal procurement requirements. Name(s) of the contact person(s) responsible for corrective action: Misty Goodwin, Chief Executive Officer, Anna Roeder, Chief Financial Officer. Planned completion date for corrective action plan: The enhanced procurement documentation procedures were implemented during FY2026 and are currently operational. Management will continue monitoring procurement files to ensure suspension and debarment verification is consistently documented and retained for all applicable Federal procurements.

Categories

Procurement, Suspension & Debarment

Other Findings in this Audit

  • 1224601 2024-004
    Material Weakness Repeat
  • 1224602 2024-004
    Material Weakness Repeat
  • 1224603 2024-004
    Material Weakness Repeat
  • 1224604 2024-004
    Material Weakness Repeat
  • 1224605 2024-004
    Material Weakness Repeat
  • 1224606 2024-004
    Material Weakness Repeat
  • 1224607 2024-004
    Material Weakness Repeat
  • 1224608 2024-005
    Material Weakness Repeat
  • 1224609 2024-005
    Material Weakness Repeat
  • 1224610 2024-005
    Material Weakness Repeat
  • 1224611 2024-005
    Material Weakness Repeat
  • 1224612 2024-005
    Material Weakness Repeat
  • 1224613 2024-005
    Material Weakness Repeat
  • 1224615 2024-004
    Material Weakness Repeat
  • 1224616 2024-004
    Material Weakness Repeat
  • 1224617 2024-004
    Material Weakness Repeat
  • 1224618 2024-004
    Material Weakness Repeat
  • 1224619 2024-004
    Material Weakness Repeat
  • 1224620 2024-004
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
93.600 HEAD START $5.79M
93.499 LOW INCOME HOUSEHOLD WATER ASSISTANCE PROGRAM $810,723
94.006 AMERICORPS STATE AND NATIONAL 94.006 $779,080
93.044 SPECIAL PROGRAMS FOR THE AGING, TITLE III, PART B, GRANTS FOR SUPPORTIVE SERVICES AND SENIOR CENTERS $698,622
10.559 SUMMER FOOD SERVICE PROGRAM FOR CHILDREN $579,388
93.569 COMMUNITY SERVICES BLOCK GRANT $573,147
94.011 AMERICORPS SENIORS FOSTER GRANDPARENT PROGRAM (FGP) 94.011 $469,648
94.016 AMERICORPS SENIORS SENIOR COMPANION PROGRAM (SCP) 94.016 $355,432
93.045 SPECIAL PROGRAMS FOR THE AGING, TITLE III, PART C, NUTRITION SERVICES $354,591
93.558 TEMPORARY ASSISTANCE FOR NEEDY FAMILIES $339,695
84.042 TRIO STUDENT SUPPORT SERVICES $329,504
14.889 CHOICE NEIGHBORHOODS IMPLEMENTATION GRANTS $325,286
10.569 EMERGENCY FOOD ASSISTANCE PROGRAM (FOOD COMMODITIES) $304,517
21.023 EMERGENCY RENTAL ASSISTANCE PROGRAM $287,812
20.526 BUSES AND BUS FACILITIES FORMULA, COMPETITIVE, AND LOW OR NO EMISSIONS PROGRAMS $287,008
17.235 SENIOR COMMUNITY SERVICE EMPLOYMENT PROGRAM $261,807
14.218 COMMUNITY DEVELOPMENT BLOCK GRANTS/ENTITLEMENT GRANTS $239,757
14.900 LEAD HAZARD REDUCTION GRANT PROGRAM $225,929
14.251 ECONOMIC DEVELOPMENT INITIATIVE, COMMUNITY PROJECT FUNDING, AND MISCELLANEOUS GRANTS $210,865
93.493 CONGRESSIONAL DIRECTIVES $209,226
93.568 LOW-INCOME HOME ENERGY ASSISTANCE $148,453
93.053 NUTRITION SERVICES INCENTIVE PROGRAM $130,362
14.267 CONTINUUM OF CARE PROGRAM $125,868
15.944 NATURAL RESOURCE STEWARDSHIP $109,000
14.231 EMERGENCY SOLUTIONS GRANT PROGRAM $105,608
17.235 SUPPORTIVE HOUSING PROGRAM $77,144
21.027 CORONAVIRUS STATE AND LOCAL FISCAL RECOVERY FUNDS $70,541
93.667 SOCIAL SERVICES BLOCK GRANT $66,686
16.575 CRIME VICTIM ASSISTANCE $65,000
10.568 EMERGENCY FOOD ASSISTANCE PROGRAM (ADMINISTRATIVE COSTS) $58,787
94.002 AMERICORPS SENIORS RETIRED AND SENIOR VOLUNTEER PROGRAM (RSVP) 94.002 $54,045
94.013 AMERICORPS VOLUNTEERS IN SERVICE TO AMERICA 94.013 $51,684
93.747 ELDER ABUSE PREVENTION INTERVENTIONS PROGRAM $44,386
93.048 SPECIAL PROGRAMS FOR THE AGING, TITLE IV, AND TITLE II, DISCRETIONARY PROJECTS $30,000
14.276 YOUTH HOMELESSNESS DEMONSTRATION PROGRAM $27,048
21.009 VOLUNTEER INCOME TAX ASSISTANCE (VITA) MATCHING GRANT PROGRAM $25,000
93.052 NATIONAL FAMILY CAREGIVER SUPPORT, TITLE III, PART E $25,000
20.507 FEDERAL TRANSIT FORMULA GRANTS $20,000
97.024 EMERGENCY FOOD AND SHELTER NATIONAL BOARD PROGRAM $15,464
93.779 CENTERS FOR MEDICARE AND MEDICAID SERVICES (CMS) RESEARCH, DEMONSTRATIONS AND EVALUATIONS $10,000
10.558 CHILD AND ADULT CARE FOOD PROGRAM $8,182
20.513 ENHANCED MOBILITY OF SENIORS AND INDIVIDUALS WITH DISABILITIES $3,845