Finding Text
2022-002 ? SUSPENSION AND DEBARMENT Federal Agency: U.S. Department of Treasury Federal Program Name: Coronavirus State and Local Fiscal Recovery Funds Assistance Listing Number: 21.027 Federal Award Identification Number and Year: SLFRP1643 - 2021 Award Period: March 3, 2021 through December 31, 2024 Type of Finding: ? Material Weakness in Internal Control over Compliance ? Other Matters Criteria or Specific Requirement: Prior to entering in subawards and contracts with award funds, recipients must verify that such contractors and subrecipients are not suspended, debarred, or otherwise excluded pursuant to 31 CFR ? 19.300. Condition: Although the System for Award Management (SAM) Exclusions maintained by the General Services Administration (GSA) was checked before the County Board approved the expenditures being charged to the grant, the expenditures had already been incurred. Therefore, the verification process was after the related contracts were already entered into for 2 of the 5 vendors that had been selected for testing. Questioned Costs: $209,192 Context: The verification process was completed after the contract was already entered into for 2 of the 5 vendors that had been selected for testing. Cause: When the purchase was made it was not known it would be federally funded. The County's process included summarizing proposed projects or expenditures for Board approval to be charged to the grant, prior to the actual reporting of the expenditures. As part of that process, the assistant county administrator was checking SAM.gov for the noted vendors at that time, but the expenditures can sometimes already be incurred at that point. The County noted that if a vendor happened to be suspended or debarred, the County then would not report the expenditures against the grant award, and the County would have to come up with a different funding source. Effect: The County should be verifying vendors before entering into the covered transaction, as there could be a risk that an expenditure is coded to the grant for a vendor that is suspended and debarred and the check to SAM.gov is then subsequently missed before reporting the expenditures against the grant proceeds. Lack proper, formal procedures and controls related to suspension and debarment could result in the County entering into a contract with an entity that is suspended or debarred or otherwise excluded from participating in the transaction, and, therefore, incurring questioned costs. Repeat Finding: Yes ? See prior year 2021-002 Recommendation: We recommend that County management ensure all departments are made aware of and trained to properly follow and document the County?s suspension and debarment procedures and controls to ensure the County verifies that contractors involved in an applicable covered transaction funded by Federal grant awards is not suspended or debarred or otherwise excluded from participating in the transaction before entering into the covered transaction. This verification may be accomplished by checking the System for Award Management (SAM) Exclusions maintained by the General Services Administration (GSA), collecting a certification from the entity, or adding a clause or condition to the covered transaction with that entity (2 CFR section 180.300). Views of Responsible Officials: There is no disagreement with the audit finding.