Finding Text
2024-001: Suspension and Debarment Control Design Deficiency
Grantor: Department of the Treasury
Program Title: COVID-19 Coronavirus State and Local Fiscal Recovery Funds
Award Name: American Rescue Plan Act (“ARPA”) - Coronavirus State Fiscal Recovery Fund and Coronavirus
Local Fiscal Recovery Fund, Coronavirus State and Local Fiscal Recovery Funds (HVIP)
Award Numbers: GRT000755, GRT000759
Assistance Listing Titles: COVID-19 Coronavirus State and Local Fiscal Recovery Funds
Assistance Listing Number: 21.027
Award Years: May 1, 2023 – December 31, 2024, July 1, 2023 – September 30, 2024
Passthrough Entities: Baltimore City Health Department, Mayor and City Council of Baltimore
Criteria
Per 2 CFR 200.214, when entering into a covered transaction with an entity, the auditee must have established
procedures to verify that the entity is not suspended, debarred or otherwise excluded from participating in the
transaction.
Condition
JHHS did not have robust procedures and controls in place from Q1 through Q3 FY2024 to ensure that an
upfront suspension and debarment check was performed on all external vendors prior to entering into a covered
transaction with JHHS.
Cause
Since 2018, JHHS has relied on a third-party service provider, PaymentWorks, to perform suspension and
debarment checks on external vendors, which requires a setup process to be completed by the vendor. There
were some vendors that did not complete setup in PaymentWorks, for which management did not perform a
separate suspension and debarment check manually. Starting in Q4 2024, management implemented a
quarterly control procedure to reconcile all vendors with expenditures in the federal grant cost center to the
PaymentWorks listing to identify vendors for which a manual suspension and debarment check must be
performed.
Effect
There was a period of time, Q1 through Q3, in which JHHS may have entered into covered transactions with
suspended or debarred entities. When management performed the new control in Q4 2024, they identified 11
vendors that had not been previously reviewed and performed a manual check for suspension and debarment
via Sam.gov. None of these 11 vendors manually checked were suspended or debarred. There were no
instances of noncompliance identified as a result of this control design deficiency in our FY2024 audit work.
Questioned Costs
There are no questioned costs associated with this finding.
Recommendation
JHHS should continue the quarterly process of reconciling the complete vendor listing with PaymentWorks to
ensure all necessary vendors are reviewed for suspension and debarment prior to entering into covered
transactions.
Management’s Views and Corrective Action Plan
Refer to Management’s View’s and Corrective Action Plan at the end of the report.