Finding 485605 (2023-002)

Material Weakness
Requirement
I
Questioned Costs
-
Year
2023
Accepted
2024-09-03
Audit: 318374
Organization: City of Poplar Bluff (MO)

AI Summary

  • Core Issue: The City did not verify if nine vendors were suspended or debarred before transactions over $25,000.
  • Impacted Requirements: This oversight violates 2 CFR Section 180.300, which mandates verification for covered transactions.
  • Recommended Follow-Up: Implement checks against the excluded parties list or obtain certifications for vendors receiving over $25,000 in federal funds.

Finding Text

Criteria: According to 2 CFR Section 180.300, when a non-federal entity enters into a covered transaction with an entity at a lower tier, the non-federal entity must verify that the entity is not suspended, debarred, or otherwise excluded. Condition: The City had transactions in excess of $25,000 with nine vendors in which they did not verify that the entities were not suspended, debarred, or otherwise excluded. Cause: The City was not aware of this requirement. Effect: The City was at risk of making material payments to a vendor who is not allowed to do business with the federal government. There was no noncompliance, but there was not internal control in place to prevent noncompliance. Questioned Costs: None. Context: Payments to nine vendors totaled $1,826,821. Total payments from the program totaled $2,087,444. As noted above, there was no noncompliance, but there was not internal controls in place to ensure noncompliance. Repeat Finding: No. Recommendation: We recommend the City check the excluded parties list system or collect certifications from the entity for any vendor in which the City expects to spend more than $25,000 of federal grant funds for the year. Views of Responsible Officials and Planned Corrective Actions: We will ensure we comply going forward.

Corrective Action Plan

Finding Type: Internal Controls over Federal Programs. Name of Contact Person: Mr. Matt Winters, City Manager, (573) 686-8620. Recommendation: We recommend that the City check the Excluded Parties List System or collect certification from the entity for any vendor in which the City expects to spend more than $25,000 of federal grant funds for the year. Corrective Action: We will ensure we comply going forward. Proposed Completion Date: Immediately.

Categories

Procurement, Suspension & Debarment Matching / Level of Effort / Earmarking Internal Control / Segregation of Duties

Other Findings in this Audit

  • 485606 2023-002
    Material Weakness
  • 485607 2023-002
    Material Weakness
  • 1062047 2023-002
    Material Weakness
  • 1062048 2023-002
    Material Weakness
  • 1062049 2023-002
    Material Weakness

Programs in Audit

ALN Program Name Expenditures
14.228 Community Development Block Grants/state's Program and Non-Entitlement Grants in Hawaii $431,534
95.001 High Intensity Drug Trafficking Areas Program $19,221
21.027 Coronavirus State and Local Fiscal Recovery Funds $16,160
20.205 Highway Planning and Construction $3,691