Auditor Description of Criteria, Condition and Effect: Under the requirements of 2 CFR Part 180 covered transactions for procurement and nonprocurement contracts that are expected to equal or exceed $25,000, the grantee must verify that the party being awarded a procurement and nonprocurement contract is not suspended, debarred, or otherwise excluded by checking the list of excluded parties, obtaining certification from the vendor or subrecipient, or including a clause or condition to the covered transaction with that entity. During our testing it was noted that seven out of nine nonprocurement contracts for subrecipients and three out of three procurement contracts for vendors did not provide evidence that the respective vendors or subrecipients were not suspended, debarred, or otherwise excluded at the time the Commission entered into the covered transactions. The failure to monitor suspension and debarment could cause the Commission to enter into covered transactions with vendors who are not eligible to have goods or services purchased with federal monies and to subrecipients who are not eligible to receive subawards. Upon review of the excluded parties listing subsequent to year end, it was determined that none of the parties that were awarded either procurement or nonprocurement contracts were excluded parties.
Auditor Recommendation. We recommend that the Commission review its procedures for issuing contracts ensure that the appropriate suspension and debarment evidence of verifications are retained for all vendors providing goods or services and subrecipients receiving subawards in excess of $25,000. The recommended best practice is to include a certification verifying suspension and debarment in every contract funded by federal dollars with every vendor or subrecipient to ensure compliance.
Responsible Person: Joseph Bertram, Financial Operations Manager.
Corrective Action. Management concurs with the finding. The Commission will ensure that all future contracts include certification language verifying suspension and debarment and will also collect separate certificates verifying suspension and debarment from current covered transactions where the certification was omitted from the contract in error. Management has continued its practice of checking suspension and debarment for covered transactions annually in preparation for the audit and notes that none of the Commission's vendors or subrecipients that were awarded contracts were excluded parties.
Anticipated Completion Date: June 30, 2025.