Finding Text
Finding 2022-003 – Procurement, suspension and debarment
Assistance Listing #: 93.243
Criteria: In accordance with the Uniform Guidance, recipients who receive federal funding shall fully comply with Subpart C of 2 CFR Part 180, which requires nonfederal entities to verify that the person/entity with whom you intend to do business is not excluded or disqualified, if the expected payments are equal to or exceed $25,000.
A non-federal entity has three options for performing this verification: 1) checking SAM exclusions; 2) collecting a certification from that person; or 3) adding a clause or condition to the covered transaction with that person.
Condition: During fiscal year 2022, the Organization contracted with several vendors for products and services who were paid more than $25,000. There was no evidence documenting that these vendors were checked for suspension and debarment prior to payment.
Cause: Fiscal year 2022 marks the Organization’s first year subject to Single Audit and it appears the vast rules and regulations are new to the Organization, however the Organization is taking steps towards compliance and updating applicable policies and procedures.
Effect: Without verifying whether vendors are suspended or debarred prior to payment, the Organization faces a heightened risk that they are expending federal dollars to excluded parties.
Questioned Costs: N/A
Repeat Finding: No
Recommendation: We recommend the Organization review its current policies to ensure they are following the suspension and debarment provisions set forth in the Uniform Guidance, lessening the risk that payments are made to parties who may be excluded from receiving federal funds.
Response: While the Organization does verify on an annual basis that the Vendor is not excluded or disqualified, that will be documented going forward. Additionally, while we did verify on first utilization of these long-utilized service providers, those will be verified on an annual basis and documented going forward.