Finding 59437 (2022-002)

Control Deficiency 2022-002: Suspension and Debarment Federal Agency: U.S. Department of Treasury Federal Program Names: COVID-19 Coronavirus State and Local Fiscal Recovery Funds Assistance Listing Numbers: 21.027 Award Periods: March 3, 2021 ? December 31, 2024 Type of Finding: Material Weakness in Internal Control Over Compliance Condition: The County has established policies and procedures in place including related controls over suspension and debarment. However, the policies and procedures were not consistently followed to ensure compliance with requirements of Uniform Guidance. Criteria or Specific Requirement: 2 CFR 200 states that nonfederal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. ?Covered transactions? include contracts for goods and services awarded under a non procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220). All non procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. When a non-Federal entity enters into a covered transaction with an entity at a lower tier, the non-Federal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. Context: While performing audit procedures, it was noted that the County did not follow established policies regarding suspension and debarment and procedures to verify compliance were not documented. Eight transactions out of a sample of eight transactions were lacking appropriate documentation. Cause: While the County has policies to ensure they do not use suspended or disbarred vendor, there was no documentation maintained to support verification before entering into a covered transaction. Effect: The County could contract with a suspended or debarred vendor. Repeat Finding: No Recommendation: We recommend the County follow their suspension and debarment policy which includes maintaining documentation related to suspension and debarment for covered transactions. Views of Responsible Officials and Corrective Action Plan: There is no disagreement with the finding. The County immediately began reviewing it?s policy related to suspension and debarment and is reviewing procedures to ensure that requirements are consistently followed in future years.