Finding 573417 (2024-001)

Federal Agency: U.S. Department of Energy Federal Program Title: Conservation and Development Program Federal Assistance Listing Number: 81.086 Award Period: July 1, 2020 – November 30, 2025 Type of Finding: Significant Deficiency in Internal Control over Compliance Criteria or specific requirement: 2 CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards requires compliance with the provisions of procurement, suspension, and debarment. Home Innovation Research Labs, Inc. should have internal controls designed to ensure compliance with those provisions. Condition: During our testing, we noted Home Innovation Research Labs, Inc. did not have documentation to support that internal controls were performed to ensure vendors were not suspended or debarred prior to entering into the contract. Questioned costs: None Context: During our testing, it was noted that for 3 of 3 items tested Home Innovation Research Labs, Inc. did not have documentation to support that it had reviewed vendors prior to entering into a contract with the vendors to ensure they were not on the suspended or debarred vendor list maintained by the General Services Administration. We verified that the selected vendors were not suspended or debarred. Cause: Home Innovation Research Labs, Inc. was unable to locate documentation to support the performance of procedures to ensure vendors were not suspended or debarred. Effect: The auditors noted no instances of noncompliance with the provisions of procurement, suspension, and debarment; however, the lack of internal controls over these compliance requirements provides an opportunity for noncompliance. Repeat finding: The prior audit concluded after the current award period had begun. Our recommendation was fully implemented subsequent to disclosure but during the period under audit. Therefore, this is a repeat finding. Recommendation: The organization implemented their corrective action plan upon disclosure of the finding from the prior year audit. That disclosure occurred after the commencement of the year this audit covers. We recommend that Home Innovation Research Labs, Inc. continue with their corrective action plan which enhanced its controls over the review process of potential vendors to determine they are not suspended or debarred and to ensure documentation to support this is maintained. Views of responsible officials: There is no disagreement with the audit finding.