Finding Text
Finding 2025-003 Type of Finding: Significant deficiency in internal control over compliance Compliance requirement: Procurement and suspension and debarment Criteria: The Uniform Guidance requires pass-through entities to verify that subrecipients are not excluded or disqualified in accordance with 2 CFR § 180.300 (e.g., suspension, debarment, or other exclusion), including verification through SAM.gov or other methods permitted under the federal regulations. Condition: Willamette Health Council made subrecipient awards during the audit period; however, Willamette Health Council did not have properly designed and implemented internal controls over compliance to verify that subrecipients were not suspended, debarred, or otherwise excluded from receiving federal funds (for example, by checking SAM.gov) prior to issuing the subawards. All such subrecipient awards should have been checked against SAM.gov for suspension and debarment/exclusion status. Willamette Health Council relied on the awarding agency to assist with approving subrecipients; however, Willamette Health Council did not document an independent verification or other control to confirm that subrecipients were not excluded or disqualified. Cause of Condition: Willamette Health Council did not establish written policies and procedures assigning responsibility for suspension and debarment verification and documentation (including when and how to perform SAM.gov verification and how to retain evidence of verification) for subawards. Effect / Potential Effect: Without controls to verify subrecipient eligibility with respect to suspension and debarment, Willamette Health Council increases the risk of making subawards to ineligible subrecipients and noncompliance with applicable federal requirements may not be prevented or detected on a timely basis. No subrecipients tested were identified as suspended, debarred, or otherwise excluded; therefore, no questioned costs were identified. Questioned Costs: None. Context/Perspective: There were five subrecipients subject to this requirement during the audit period. The subaward files/documentation did not contain evidence of SAM.gov verification; however, auditor performed independent verification on SAM.gov noting the subrecipients were not on the exclusions listing. Repeat Finding: Not applicable. There was no prior year audit. Recommendation: We recommend that Willamette Health Council implement and document policies and procedures to verify that subrecipients are not excluded or disqualified prior to issuing subawards (and periodically thereafter, if deemed appropriate). View of Responsible Officials: Management agrees with the finding. See Corrective Action Plan.