Finding Text
2023-007 Suspension and Debarment
Prior Year Finding Number: N/A
Year of Finding Origination: 2023
Type of Finding: Internal Control Over Compliance and Compliance
Severity of Deficiency: Material Weakness and Modified Opinion
Federal Agency: U.S. Department of the Treasury
Program: 21.027 COVID-19 – Coronavirus State and Local Fiscal Recovery Funds
Award Number and Year: Federal Direct; 2022
Pass-Through Agency: N/A – Direct
Criteria: Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must maintain internal control over federal programs that provides reasonable assurance that the auditee is managing federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards.
Federal requirements prohibit non-federal entities from contracting with or making subawards under covered transactions to parties that are suspended or debarred. Title 2 U.S. Code of Federal Regulations § 180.300 describes a required verification process. Prior to entering into the transaction, one of the following must be performed: (1) checking SAM.gov exclusions, (2) collecting a certification, or (3) adding a clause or condition to the covered transaction.
The County’s procurement policy requires SAM.gov search results to be documented prior to entering into a covered transaction.
Condition: In the sample of three covered transactions tested, the County did not have documentation to support that a verification for suspension or debarred vendors was performed by County staff prior to entering into the covered transactions.
Questioned Costs: None
Context: None of the vendors tested were listed as suspended or debarred on SAM.gov at the time of the audit.
The sample size was based on guidance from chapter 11 of the AICPA Audit Guide, Government Auditing Standards and Single Audits.
Effect: Failure to verify vendors are not suspended, debarred, or otherwise excluded prior to entering into a covered transaction may result in the County entering into a transaction with a vendor that is not authorized to provide goods and services under the grant.
Cause: The County informed us that documentation of SAM.gov searches for covered transactions could not be located due to staffing changes.
Recommendation: We recommend the County maintain documentation to demonstrate that vendors were not suspended, debarred, or otherwise excluded from conducting business with the County; the County should complete this documentation prior to entering into a covered transaction.
View of Responsible Official: Acknowledge