Finding Text
Finding 2023-004
Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters
Federal Agency: U.S. Small Business Administration and U.S. Department of Treasury
Federal Program: Congressional Grants, ALN No. 59.059, Award SBAHQ2210040, Award Period 9/1/2022 –
3/31/2023; and COVD-19 Coronavirus State and Local Fiscal Recovery Funds, ALN No. 21.027, Award FY22-
BASE-BTBC, Award Period 6/16/2022 – 6/15/2024
Compliance Requirement: Suspension and Debarment
Repeat Finding: No
Condition: During our testing of three covered transactions (all vendors), we noted that management was not able to provide supporting documentation that suspension and debarment procedures were performed before the start of the procurement activity.
Questioned Costs: None
Context: The finding was noted for two of two vendors tested for 59.059 and the one vendor tested for 21.027.
Criteria: 2 CFR 180.300 prohibits entities from contracting under covered transactions to parties that are suspended or debarred from doing business with the federal government. A contract for goods or services is a covered transaction if awarded as a grant or payment for specified use and if the amount of the contract is expected to equal or exceed $25,000. In order to comply with federal suspension and debarment requirements, the Organization can perform a search in the federal System of Award Management (SAM) website, which tracks the entities that the federal government has determined are ineligible to receive federal funding; collect a certification from the entity; or add a clause or condition to the contract.
Cause: Federal grants were new to the Organization and the required suspension and debarment checks were not done timely.
Effect: The finding indicates that there could be some process improvements in how contracts are reviewed,
documented and maintained to provide evidence the compliance requirements are being met.
Recommendation: We recommend that the Organization either obtain certifications from vendors stating their organization is not suspended, debarred, or otherwise excluded from participation in federal assistance programs or document the procedures performed to verify the vendor is not identified as suspended or debarred on the SAM website. We recommend that Organization has proper procedures in place to ensure that all contractual documentation is maintained and able to be located.