3.) Finding 2023-002 Procurement Policy
a. Program Information: N/A
b. Criteria: The Uniform Guidance requires that, for covered transactions, the non-Federal entity verify that entities are not suspended, debarred, or otherwise excluded.
c. Condition: During our audit, we inquired with management regarding their procurement policy that was implemented in April 2022. While policy exists, there were no specific procedures noted in the procurement policy to ensure that vendors are not suspended or debarred.
Response:
Explanation: Our procurement policy, updated in April 2022, lacked specific procedures for verifying that vendors are not suspended or debarred. Debarment attestation is necessary to ensure that federal funds are not misused or directed towards entities that have been found to violate legal or ethical standards. By verifying the status of vendors, a nonprofit can mitigate against the risk of its funds being misappropriated or wasted on entities that may not deliver against agreements due to their questionable legal standing.
Corrective Action: We have revised our procurement policy to include specific debarment language and procedures ensuring that vendors are not suspended or debarred. This revision includes:
- Regular checks against the list of suspended or debarred entities, showing no active exclusions from the System for Award Management (SAM).
- Requiring a signed Debarment Certification Form or debarment contract language included for all government purchases/contracts/agreements greater than $25,000.
- Training for our accounts payable and procurement team members on these procedures.
Future Measures: We will conduct annual reviews of our procurement practices and records to ensure they remain compliant with our policies, federal regulations, and best practices.
Contact person responsible for corrective action: John Domingo, Finance & IT Director
Completion date: 07/01/2023