Finding 522655 (2024-001)

NON-COMPLIANCE AND DEFICIENCY IN INTERNAL CONTROLS OVER COMPLIANCE WITH SUSPENSION AND DEBARMENT REQUIREMENTS Federal Agency: U.S. Department of Treasury Federal Program Title: COVID 19 - Coronavirus State and Local Fiscal Recovery Funds Assistance Listing: 21.027 Pass-Through Entities: Cook County Department of Public Health and Illinois Department of Human Services Criteria – In accordance with 2 CFR part 180 non-federal entities are prohibited from contracting with, or making subawards to parties that are suspended or debarred, or otherwise excluded. “Covered transactions” include contracts for goods and services awarded under a non-procurement transaction that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. The requirement is for non-federal entities to check for suspended or debarred persons or entities before entering into covered transactions with them. In addition, 2 CFR 200.303 requires that “The non-Federal entity must: (a) Establish, document and maintain effective internal control over the Federal award that provides reasonable assurance that the recipient or subrecipient is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award”. Condition – The Organization has a federal suspension and debarment policy however, the Organization did not perform the proper suspension and debarment check on SAM.gov for the tested vendors in our sample, prior to engaging them to provide goods or services to the Organization. We tested a sample of three vendors in a total population of fifteen subject to this compliance requirement for the major program. Questioned Costs – None, as management subsequently demonstrated that none of the tested vendors contracted in covered transactions had been suspended or debarred. Effect – The Organization did not perform proper suspension and debarment procedures regarding certain vendors of covered transaction prior to obtaining their services. This could have resulted in disallowed costs by the federal grantor. Cause – The Organization did not follow the written policies, procedures and controls in place to ensure compliance with the federal suspension and debarment. Recommendation – We recommend that the Organization strengthen procedures and internal controls to ensure that the Uniform Guidance suspension and debarment requirements are complied with, and that support for the dates and the results of suspension and debarment checks on SAM.gov are retained. Views of Responsible Officials – We agree with the auditors’ finding.