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2022 ? 001 Procurement and Suspension and Debarment Federal Agency: U.S. Department of Health and Human Services Federal Program: Consolidated Health Centers Grant and Community Project Funding/Congressionally Directed Spending - Construction AL Number: 93.224 & 93.527 and 93.493 Award Period: 1/1/22 - 12/31/22 Type of Finding: Significant deficiency in Internal Control over Compliance and 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 and suspension and debarment. The Organization should have internal controls designed to ensure compliance with these provisions. Condition and Context During our testing over suspension and debarment, we noted the two instances in which the Organization did not perform the suspension and debarment check prior to entering into a transaction with a vendor. Effect The auditor noted an instance of noncompliance. Noncompliance could result in possible federal funds being provided to ineligible vendors. Questioned Costs None identified. Cause The Organization lacks established internal controls and procedures over financial grant management. The Organization did not perform the suspension and debarment check prior to entering into the transaction. Recommendation We recommend the Organization implement a process to ensure suspension and debarment checks are performed and documentation to show that the checks are occurring prior to entering into transactions with vendors. Section III ? Findings and Questioned Costs ? Major Federal Programs (Continued) 2022 ? 001 Procurement and Suspension and Debarment (Continued) Views of Responsible Officials The Organization has updated is procurement and suspension and debarment processes to include the following procedures and internal controls: ? The Organization has implemented a process to ensure suspension and debarment checks are performed prior to entering into a transaction with new vendors. The Organization utilizes Sam.gov to perform the suspension and debarment checks. In addition to completing the suspension and debarment checks with new vendors, the accounting and compliance departments will also verify quarterly that existing vendors are not on the suspended and debarred listing. ? An Approved Vendor List will be added on the Organization?s Public Sharepoint. The approved vendor list will be added as of July 31, 2023. Before a new vendor is selected by internal management staff, they must refer to the approved vendor list to see if goods or services can be acquired from one of the approved vendors. If a new vendor must be selected, the manager must send documentation that a suspension and debarment check has occurred and a copy of the RFP (when applicable) before using the vendor for goods or services. The accounting manager will review the new vendor selection to verify that the suspension and debarment check occurred. Once this has been verified the accounts payable coordinator will be given the approval to add the new vendor to the accounting software. The accounts payable coordinator will add screen shots of the verification in the accounting software under each vendor. The accounts payable coordinator will also retain Vendor Files in Sharepoint, which include, verifications, vendor invoices, and any vendor contracts.