Finding Text
Finding 2022-003: Suspension and Debarment Federal Programs: CFDA 14.235 Criteria or Specific Requirement: Recipients of U.S. Government funds must adhere to specific requirements on screening all potential vendors, suppliers and sub-contractors/grantees to ensure the organization is not conducting business with excluded parties (as defined by the U.S. Government); the screening must be documented in writing. Condition: During the fiscal year, NEW did not consistently perform the screening process for its potential and current vendors, suppliers, contractors, subrecipients, employees, fellows, etc. that were paid with Federal funds. Cause: NEW has a formal policy in place with regard to suspension and debarment screenings, but did not adhere to its policy and retain documentation of screenings, during the fiscal year. Effect or Potential Effect: Failure to screen potential and current vendors, suppliers, contractors, subrecipients, employees, fellows, etc. increases the potential that Federal funds be inadvertently provided to parties deemed to be suspended or disbarred by the United States Government. Questioned Costs: Indeterminable Context: Payments were made during the fiscal year without performing the proper screening process. Our audit work in this area consisted of internal control testwork over a random sample of expenditures, as well as substantive testwork over transactions above a defined threshold from select expense accounts that were charged to the Federal program. We consider our samples to be representative of the respective populations, and thus, are statistically valid samples. The issue is deemed to be systemic. Identification as a Repeat Finding, if Applicable: 2020-001, 2021-001 Recommendation: We recommend NEW revisit its current policy and ensure that all types of parties (as noted above) are included, and educate its employees on the procedures necessary to ensure full compliance with this requirement. We also recommend NEW document each of these screenings and retain them in the respective files, which should be completed prior to engaging in relationships with these parties. For ongoing relationships, NEW should consider performing screenings on an annual basis (and document them) to ensure continuous compliance in the event the suspension and debarment status of any of these parties changes. Lastly, we recommend NEW perform retrospective screenings on these parties it made payments to during the fiscal year.