Finding 544633 (2024-002)

Program Affected AL Number 21.027 Coronavirus State and Local Fiscal Recovery Funds, passed through the Maine Department of Economic and Community Development, agreement period through June 30, 2024.Criteria Required by 2 CFR, Part 200 for federally funded programs, when an organization enters into a covered transaction with an entity or individual, the organization must verify that the vendor is not suspended or debarred or otherwise excluded from participating in federal programs. Generally, a covered transaction is a transaction expected to equal or exceed $25,000 and be funded with federal dollars. This verification may be accomplished by checking the System for Award Management (SAM), or by adding a clause or condition to the covered transaction. Condition and Context During our testing, we noted management did not retain documentation for their review of SAM for 8 of the beneficiaries meeting the covered transaction threshold prior to disbursing funding. Our nonstatistical sample of 25 transactions included 19 transactions equal to or exceeding $25,000. We understand the SAM was checked after the transactions were completed. Questioned Costs N/A Cause and Effect The Institute was unaware of the requirement to verify beneficiaries. Since this process was not performed, there is a greater risk of beneficiaries that are included on the SAM being disbursed funds through federal funds. Identification as a Repeat Finding, if Applicable Not applicable. Recommendation BerryDunn recommends that the Institute establish and follow a policy to confirm funds are not provided to those suspended or debarred in advance of the completed transaction as well as retain the documentation that the search was completed. Views of Responsible Officials and Planned Corrective Actions Management agrees with the finding. See attached Planned Corrective Actions.