Finding 4410 (2023-002)

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Requirement
I
Questioned Costs
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Year
2023
Accepted
2023-12-15
Audit: 6863
Organization: Linden Community Schools (MI)

AI Summary

  • Core Issue: The District failed to document checks on vendor suspension and debarment as required by federal guidelines.
  • Impacted Requirements: Compliance with internal purchasing policies and the Uniform Guidance for federal awards.
  • Recommended Follow-Up: Implement internal controls to ensure proper documentation of compliance with suspension and debarment checks.

Finding Text

Suspension and Debarment Finding Type. Immaterial Noncompliance (Procurement, Suspension and Debarment). Program. Special Education Cluster; U.S. Department of Education; Assistance Listing Number 84.027X, Award 221280-2122. Criteria. Recipients of federal awards are required to follow their own internal purchasing policies, as well as complying with purchasing standards set forth in the Uniform Guidance. Part of that guidance requires an entity to check if a vendor is suspended or debarred before entering into a contract. Condition. The District was unable to provide documentation to support its consideration of suspension and debarment requirements for the vendor selected for testing. Cause. The District does not have the proper internal controls in place to ensure that documentation of the verification is retained in accordance with federal requirements. Effect. The District is exposed to an increased risk that future noncompliance could occur and not be prevented or detected by the District's internal controls. Questioned Costs. No costs were required to be questioned as a result of this finding inasmuch as our testing did not reveal any unallowed costs, and the vendor in question was not actually suspended or debarred. Recommendation. We recommend that the District implement necessary internal controls to ensure documentation of its compliance with the requirements of the Uniform Guidance is maintained. View of Responsible Officials. The District will implement the necessary internal controls to ensure the policy for compliance is followed and documented.

Corrective Action Plan

2023-002 - Susepnsion and Debarment Auditor Description of Condition and Effect: The District was unable to provide documentation to support its consideration of suspension and debarment requirements for the vendor selected testing. The District is exposed to an increased risk that future noncompliance could occur and not be prevented or detected by the District's internal controls. Auditor Recommendation: We recommend that the District implement necessary internal controls to ensure documentation of its compliance with the requirements of the Uniform Guidance is maintained. Corrective Action: In accordance with the procurement policy listed below, management will implement an additional control to ensure compliance. Individual transactions over $25,000 charged to federal grant fund accounts shall require the signature of both the relevant program director as well as either the Business Services Director or Superintendent. Prior to signing, written documentation must be obtained verifying the vendor is either preapproved through the State of Michigan, or has been verified via www.sam.gov. [The District shall not subcontract with or award subgrants to any person or company who is debarred or supsended. For contracts over $25,000, the District shall confirm that the vendor is not debarred or suspended by either checking the Federal Government's System for Award Management, which maintains a list of such debarred or suspended vendors at www.sam.gov; collecting a certification from the vendor; or adding a clause or condition to the covered transaction with that vendor. (2 CFR Part 180 Subpart C)] Responsible Person: Kylie Rush, Director of Business Services Anticipated Completion Date: June 2024

Categories

Procurement, Suspension & Debarment

Other Findings in this Audit

Programs in Audit

ALN Program Name Expenditures
84.425 Education Stabilization Fund $1.45M
84.010 Title I Grants to Local Educational Agencies $218,191
84.027 Special Education_grants to States $141,717
10.553 School Breakfast Program $84,731
10.555 National School Lunch Program $56,259
84.424 Student Support and Academic Enrichment Program $44,070
84.367 Improving Teacher Quality State Grants $36,462
93.778 Medical Assistance Program $13,905
84.365 English Language Acquisition State Grants $946
10.649 Pandemic Ebt Administrative Costs $628