Finding Text
2024-002 Suspension and Debarment
Federal Agency: U.S. and Department of Treasury
Federal Program Title: Coronavirus State and Local Fiscal Recovery
Assistance Listing Number: 21.027
Award Period: October 1, 2023 to September 30, 2024
• Significant Deficiency in Internal Control over Compliance
• Other Matter
Criteria: 2 CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Award requires compliance with the provisions of suspension and debarment.
2 CFR Part 180.220, states that recipients of federal funds are prohibited from contracting with or making sub awards under covered transactions to parties that are suspended or debarred. “Covered transactions” include those procurement contracts for goods and services awarded under a nonprocurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria.
When a nonfederal entity enters into a covered transaction with an entity at a lower tier, the nonfederal entity must verify that the entity is not suspended or debarred or otherwise excluded from participating in the transaction. This verification may be accomplished by:
(1) Checking the Excluded Parties List System (EPLS) maintained by the General Services Administration (GSA) and available at https://www.sam.gov/portal/public/SAM;
(2) Collecting a certification from the entity, or
(3) Adding a clause or condition to the covered transaction with that entity.
CSC should have internal controls designed and effectively operating to ensure compliance with those provisions.
Condition: During our testing, we noted CSC did not maintain support to show its review of the search for suspension and debarment was done before contracts were entered into. CSC did not have effective controls to ensure vendors were not suspended or debarred.
Questioned Costs: None
Context: For four out of four vendors tested, we noted that documentation related to suspension and debarment verification was not documented. However, our testing did not identify any vendors that had been suspended or debarred.
Cause: The policies and procedures surrounding suspension and debarment verification were not consistently followed as designed.
Effect: CLA noted no instances of noncompliance with the provisions of procurement, suspension, and debarment; however, the lack of effective internal controls over these compliance requirements provides an opportunity for noncompliance.
Repeat Finding: No
Recommendation: We recommend CSC ensure consistent application of its policies and procedures so that an adequate verification process is in place to review potential contractors to determine they are not suspended or debarred before entering into the contract. Alternatively, a clause can be added to CSC’s standard procurement contracts requiring CSC’s potential vendors to attest to whether they have been suspended or debarred.
Views of Responsible Officials of the Auditee: There is no disagreement with the audit finding.
CSC’s has updated its policy as of April 2025 to state that a contract or subgrant must not be made to parties listed on the government-wide exclusions in the System for Award Management (SAM). CSC must confirm that all new contractors, consultants, and subrecipients are not listed in SAM Exclusions.