Finding Text
Finding 2022-005 Internal Control Over Debarment Type of Finding: Material Weakness in Internal Control over Compliance. Condition and Context: An effective internal control system was not in place at the Organization to ensure compliance with requirements related to reviewing the debarment and suspension status of qualifying vendors before issuing federal funds. Criteria: Management is responsible for establishing internal controls to prevent making cumulative payments in excess of $25,000 to any party which is debarred, suspended, otherwise excluded from, or ineligible for participation in Federal assistance programs by any Federal department or agency. Cause: The Organization had not established an effective system of internal controls that would have ensured compliance with the grant agreement and the requirement to review federal debarment or suspended status for all qualifying vendors in excess of this threshold. Effect: The failure to establish an internal control system could enable noncompliance to go undetected. Noncompliance with the grant agreement leading to payments made to debarred entities could have resulted in the loss of federal funds to the Organization. Questioned Costs: There were no questioned costs identified. Recommendation: We recommended that the Organization's management establish and implement a system of internal controls and maintain adequate supporting documentation to ensure all qualifying vendors are reviewed for federal debarment and suspension status before payments are paid to the vendors. Views of Responsible Officials: The Organization?s Board and Executive Team consisting of the CEO and COO acknowledge the finding related to an internal control to prevent payments to any vendor that is debarred, suspended or otherwise ineligible to receive federal funding. In 2023 the Organization adopted a process to ensure all potential vendors are qualified utilizing the SAM.gov system and internal tracking and record keeping.