Finding Text
Criteria: Internal Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non- Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Compliance: Per 2 CFR 200.213, Suspension and Debarment 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. Condition: The City did not have an internal control process and did not maintain documentation of a vendor’s suspension and debarment status. Cause: The City had not developed internal control policies and procedures to prevent entering into a contract with an organization that was debarred or suspended. Questioned Costs: None noted. Effect: Federal funds may be paid to parties that are ineligible to participate in a federal program. Recommendation: We recommend the City evaluate its policies procedures to ensure that suspension and debarment requirements are being met prior to entering into transactions with vendors. Identification of Repeat Finding: This is a first year finding. Views of Responsible Officials: Management agrees with the finding.