Finding Text
Finding 2023-006: Significant Deficiency - Procurement and Suspension and DebarmentInternal Control over Verification Against the System for Award Management (“SAM”)
Assistance Listing Program Title and Number: Coronavirus State and Local Fiscal Recovery
21.027
Federal Agency: Department of Treasury
Pass-through Entity: N/A
Award year: 2023
Criteria or specific requirement:
2 CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements
for Federal Awards, (Uniform Guidance) requires compliance with provisions of procurement,
suspension, and debarment.
Non-federal entities are prohibited from contracting with or making subawards under covered
transactions to parties that are suspended or debarred. When a non-federal entity enters into a
covered transaction with an entity at a lower tier, the nonfederal entity must verify that the entity,
as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or
debarred or otherwise excluded from participating in the transaction.
Condition:
The Town did not retain any formal documentation proving they checked all proposed vendors
with SAM.gov to see if they were suspended or debarred from receiving federal funds prior to
purchase.
Cause:
While the Town has a formal policy requiring the purchasing department to perform verification of
suspension or debarment over vendors that they make contracts with federally funded projects, it
does not maintain formal documentation that this procedure occurred.
Effect:
Without documented evidence of verifying whether the Town was followings its policy, the Town
could not provide evidence of this control was being completed for federally funded projects.
There were no standard forms or templates that were used to document verification that parties
are not suspended or debarred.
Prevalence:
There was no documentation available for nine out of nine of selections tested. However, none of
the vendors selected for testing were suspended or debarred.
Questioned costs:
None.
Repeat Finding:
No
Recommendation:
We recommend that the Town implement a policy to formally document the procedures they are
performing to demonstrate compliance with the Single Audit Act.
Views of Responsible Officials:
Management agrees with the finding.