Finding Text
Finding 2023-002
Significant deficiency in internal control over compliance with suspension and debarment requirements
Federal Agency: Department of Housing and Urban Development
Assistance Listing Number: 14.251
Assistance Listing Name: Community Project Funding
Award Number: B-23-CP-WA-1530
Criteria
Nonfederal entities are prohibited from contracting with or making subawards under covered transactions to
parties that are suspended or debarred and must verify that such parties are not suspended or debarred. This
verification may be accomplished by (1) checking the System for Award Management (SAM) Exclusions
maintained by the General Services Administration (GSA), (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). The source of
requirements for suspension and debarment are in 2 CFR 180.
Condition and Context
During our testing of the suspension and debarment compliance requirement, we noted that the Aquarium had
not performed the required verification at the time of entering into applicable vendor contracts. We tested a
sample of two vendors and the Aquarium had not performed the required verification on these vendors. However,
at the time of our audit testing, the Aquarium did check the System for Award Management Exclusions and
verified that neither vendor was suspended or debarred.
Cause
The Aquarium’s system of internal control did not require performance of the required verification of suspension
and debarment for vendors before entering into vendor contracts.
Effect
The effect of this control deficiency is the Aquarium is at risk of entering into a vendor contract before the
Aquarium has verified the vendor is not suspended or debarred.
Questioned Costs
None.
Repeat Finding
This is not a repeat finding.Recommendation
We recommend management update its procurement policies and procedures to perform the required verification
for suspension and debarment before entering into vendor contracts that will be charged to federal awards.
Views of Responsible Officials and Corrective Action Plan
Management agrees with the finding and has provided the accompanying corrective action plan.