Finding 585070 (2022-002)

Federal Agency: U.S. Department of Treasury Federal Program Title: COVID-19 Coronavirus State and Local Fiscal Recovery Funds, Assistance Listing Number 21.027 Federal Award Program Year: January 1, 2022 - December 31, 2022 Pass-through Agency: Indiana Finance Authority Pass-through Number: Unknown Type of Finding: Significant Deficiency Criteria or Specific Requirement - Procurement, Suspension and Debarment: Pursuant to 31 CFR § 19.300, non-Federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended and debarred or whose principals are suspended or debarred. The non-Federal entity must verify that the contracted entity is not suspended or debarred or otherwise excluded. In addition, pursuant to 2 CFR 200.303, which states in part, the non-Federal entity must establish and maintain an effective internal control over the Federal awards that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with the Federal statutes, regulations and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in "Standards for Internal Control in the Federal Government" issued by the Comptroller General of the United States of the "Internal Control Integrated Framework", issued by the Committee of Sponsoring Organizations of the Treadway Commission. Condition: The County could not provide support that it had reviewed the "List of Parties Excluded from Federal Procurement and Nonprocurement Programs" during their procurement procedures on a consistent basis. The County had not properly designed or implemented a system of internal controls which would include appropriate segregation of duties that would likely be effective in preventing, detecting and correcting noncompliance. Questioned Costs: None Context: It was noted that the two files selected for testing did not have documented evidence supporting that the County had determined that the contracted parties were not suspended or debarred. From a population of thirteen files, two were selected for testing. Our sample was not intended to be statistically valid. Effect: The County was unable to support vendors were not suspended or debarred. Cause: Failure to maintain sufficient procurement records. Identification as a Repeat Finding: Yes Recommendation: We recommend that the County maintain adequate documentation to ensure compliance with the suspension and debarment requirement. This documentation could include a print out from the Excluded Parties List System maintained by the General Services Administration, collection of a certification from the contracted party, or adding a clause or condition to the covered transaction with the contracted party. Views of Responsible Officials and Planned Corrective Action: The County is aware of the compliance requirement and has implemented additional procedures, including certain of those identified in the recommendation above, to be able to support suspension and debarment processes are in place. Persons responsible for implementing: Abby Doyle, Chief Deputy Auditor Anticipated completion date: Completed.