Finding 20095 (2022-001)

Criteria or specific requirement: When a non-federal entity enters into a covered transaction with an entity at a lower tier, the non-federal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. This verification may be accomplished by (1) checking the System for Award Management (SAM) Exclusions maintained by the General Services Administration (GSA) and available at https://www.beta.sam.gov, (2) collecting a certification from the entity, or (3) adding a clause or condition to the covered transaction with that entity (2 CFR section 180.300). Condition: We sampled four covered transactions that lacked documentation supporting that the vendor was not suspended or debarred. Management had historically elected to verify the vendor was not suspended or debarred by checking the SAM exclusion list as maintained by the GSA; however, no evidence was retained by the University to support the list was checked prior to entering into the covered transaction. Questioned costs: N/A Context: All four covered transactions tested for suspension and debarment compliance lacked documentation supporting that the University verified the vendor was not suspended or debarred prior to entering into the covered transactions. Cause: Management did not retain evidence demonstrating they verified the vendors were not suspended or debarred prior to entering into the covered transaction. Effect: By not retaining evidence that management verified vendors were not suspended or debarred, Management may erroneously enter into a covered transaction with vendors that were suspended or debarred. Repeat finding: Yes 2021-004 Recommendation: As part of the June 30, 2021 compliance audit, we recommended management adopt a policy to ensure evidence of compliance to suspension and debarment regulations are maintained. This can include maintaining evidence that management reviewed the GSA website, maintaining a certification from the vendor, or including a clause in a contract with vendors that they are not suspended or debarred. Management has indicated this policy was implemented in March 2023. View of responsible official: The University agrees with the finding.