Finding 539552 (2024-005)

Federal Agency: Department of Health and Human Services Federal Program Name: Coronavirus State and Local Fiscal Recovery Fund Assistance Listing Number: 21.027 Federal Award Identification Number and Year: N/A, 2024 Award Period: 7/1/2023-6/30/2024 Compliance Requirement: Suspension and Debarment Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Criteria or Specific Requirement: Compliance: 2 CFR section 200.318, which include oversight of contractors’ performance, maintaining written standards of conduct for employees involved in contracting, awarding contracts only to responsible contractors, and maintaining records to document history of procurements. 2 CFR 200.213 Suspension and Debarment restricts awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities: a) Checking SAM Exclusions; or b) Collecting a certification from that person; or c) Adding a clause or condition to the covered transaction with that person. Internal Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: The City was unable to provide documentation of a vendor’s suspension and debarment status. The City is required to review and document a vendor’s suspension and debarment status prior to contracting with the vendor. We noted that the City did not document the vendor’s status in accordance with the federal requirements. Questioned Costs: None Context: Two of the two vendors selected for the fiscal year 2024 testing did not have evidence of the vendor’s suspension and debarment status prior to the contract date. Cause: The contractors selected for testing were not updated to include the suspension and debarment clause. Effect: The City is unable to document compliance with suspension and debarment status prior to contracting with the vendor. Repeat Finding: No Recommendation: We recommend that the City review and enhance current procedures to ensure that the vendor’s suspension and debarment status is documented prior to contracting with the vendor. Views of Responsible Officials: There is no disagreement with the audit finding and new personnel in the Department of Community and Human Services will ensure that all required monitoring is performed and documented in a timely manner.