Finding Text
Finding 2024-005 Finding Type: Noncompliance and significant deficiency in internal control Federal Department: U.S. Department of Health and Human Services, Centers for Disease Control and Prevention Identification of the Federal Program: Assistance Listing Number 93.988 – Cooperative Agreements for Diabetes Control Programs Award Number: NU58DP007394 Compliance Requirement(s): Procurement and Suspension and Debarment Criteria: Per 2 CFR Part 200.318(a) (Documented Procurement Procedures), the recipient or subrecipient must maintain and use documented procedures for procurement transactions under a federal award or subaward, including for acquisition of property or services. These documented procurement procedures must be consistent with state, local, and tribal laws and regulations and the standards identified in 2 CFR Part 200.317 through 2 CFR Part 200.327. Non-federal entities are prohibited from contracting with parties that are suspended or debarred. Covered transactions include contracts or goods and services that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR 180.220. Per 2 CFR Part 180.300, when a non-federal entity enters into a covered transaction with another entity at the next lower tier, the non-federal entity must verify that the entity with whom it intends to do business is not excluded or disqualified by: 1) Checking SAM.gov exclusions; or 2) Collecting a certification from that entity; or 3) Adding a clause or condition to the covered transaction with that entity. Per 2 CFR Part 200.303(a), the recipient and subrecipient must establish, document, and maintain effective internal control over the federal award that provides reasonable assurance that the recipient or subrecipient is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. These internal controls should align with the 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 COSO. Condition: The Imperative did not have a written procurement policy in place for 2024 as required by 2 CFR Part 200.318(a). The Imperative provided AL #93.988 funds equal to or exceeding $25,000 to seven subgrantees and contractors during 2024. The Imperative failed to perform and document a verification check on SAM.gov for one contractor totaling $25,000. Additionally, the corresponding contract did not contain a suspension and debarment certification clause, and the Imperative did not obtain a signed vendor-specific suspension and debarment certification. Cause: Due to oversight, the Imperative did not establish a written procurement policy or maintain adequate internal controls and documentation over the procurement and suspension and debarment process for the AL #93.988 program for 2024. Effect: The potential exists that the Imperative could have provided federal funds to suspended or debarred parties, resulting in the Imperative being in noncompliance with federal procurement regulations. Questioned Costs: None. Repeat Finding: Not applicable. Recommendation: We recommend that the Imperative implement procedures to establish a written procurement policy, establish a process of vetting vendors and maintain adequate internal controls over the procurement and suspension and debarment process. View of Responsible Officials: See management’s corrective action plan.