Finding 600541 (2022-002)

Finding 2022-002: Procurement, Suspension and Debarment Federal Agency: U.S. Department of Education Federal Program: Education Stabilization Fund (ALN 84.425F) Award Year: July 1, 2021 ? June 30, 2022 Criteria or Specific Requirement: Per 2 CFR 200.303, the non-federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition Found: In a sample of 5 expenditures totaling $753,542 of the total Institutional Portion of expenditures to 12 vendors of covered transactions of $1,047,431, we were unable to obtain audit evidence that the University followed its internal policy that requires vendors in covered transactions to be verified for suspension and debarment. Cause and Possible Asserted Effect: Given the recent retirement of the purchasing director, management was not able to provide written evidence that the verification for suspension and debarment had been performed for the sample of vendors. The lack of documentation that this policy was being followed could have resulted in instances where the University entered into a covered transaction with a suspended or debarred vendor. As part of the audit procedures, we were able to independently verify that the sampled vendors were not suspended or debarred. Questioned Costs: None. Whether the Sample Was a Statistically Valid Sample: The sample was not intended to be, and was not, a statistically valid sample. Identification of Whether the Audit Finding Was a Repeat Finding in the Immediately Prior Audit: No similar findings were noted in the prior year audit. Recommendation: We recommend the University retain written evidence that its internal policies regarding suspension and debarment are being followed. View of Responsible Officials: The Controller's Office will implement an additional internal control for this compliance requirement. In addition to Procurement's verification and documentation, Accounting will also perform a verification of the written evidence of the suspension and debarment review.