Finding Text
FINDING: 2022-001 Type of Finding: Material weakness in internal control over and compliance with suspension and debarment Federal Agency: U.S. Department of Agriculture and U.S. Department of Treasury Federal Program Title: Child Nutrition Cluster and State and Local Fiscal Recovery Funds Assistance Listing Number: 10.553, 10.555, 10.559, and 21.027 Pass-Through Agency: Minnesota Department of Education Pass-Through Number: 1-0077-000 Award Period: Year ended June 30, 2022 Criteria or Specific Requirement: 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. This verification may be accomplished by: 1) checking the System for Award Management (SAM) Exclusions maintained by the General Services Administration (GSA); 2) collecting a certification from the entity; or 3) adding a clause or condition to the covered transaction with that entity (2 CFR section 180.300). Condition: The District did not retain formal documentation of its testing and controls to ensure that all vendors over the $25,000 contract threshold on a District-wide basis were not suspended or debarred prior to awarding the related contracts. Questioned Costs: None Context: None of the 8 contracts tested included formal documentation of the District?s testing and controls to ensure that all vendors over the $25,000 contract threshold on a District-wide basis were not suspended or debarred prior to awarding the related contracts. Cause: District has been unaware of formal documentation suspension and debarment requirements on a District-wide basis for any contract or procurement with all or part of the contract coded to the Food Service Fund. Effect: Lack of proper procedures and controls related to the suspension and debarment could result in improper contracts with suspended or debarred vendors being paid with federal funds. Repeat Finding: No Recommendation: We recommend that the District reviews its related policies and procedures to ensure it is retaining documentation showing that the District crosschecked the vendors with procurements over the threshold of $25,000 at the time of procurement, which could be accomplished by (1) checking the System for Award Management (SAM) Exclusions maintained by the General Services Administration (GSA), (2) collecting a certification from the entity, or (3) adding a clause or condition to the covered transaction with that entity (2 CFR section 180.300). Views of responsible officials: There is no disagreement with the audit finding.