Finding Text
Finding 2022-005 – Significant Deficiency, Procurement and Suspension, and Debarment -
Internal Control over Verification Against the System for Award Management (“SAM”)
Assistance Listing Program Title and Number: Coronavirus State and Local Fiscal Recovery
21.027
Federal Agency: Department of Treasury
Pass-through Entity: N/A
Award year: 2022
Criteria or specific requirement:
2 CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements
for Federal Awards, (Uniform Guidance) requires compliance with provisions of procurement,
suspension, and debarment.
Non-federal entities are prohibited from contracting with or making subawards under covered
transactions to parties that are suspended or debarred. When a non-federal entity enters into a
covered transaction with an entity at a lower tier, the nonfederal 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.
Condition:
During our audit, we noted that the City did not have documentation to support that it verified
vendors selected for testing against the SAM to ensure that they were not suspended or debarred
from federally funded purchases.
Cause:
While the City has a formal policy requiring the purchasing department to perform verification of
suspension or debarment over vendors that the City enters into contracts with for federally funded
projects, it does not maintain formal documentation that this procedure occurred.
Effect:
Without documented evidence of verifying whether the City was followings its policy, the City
could not provide evidence of this control was being completed for federally funded projects.
There were no standard forms or templates that were used to document verification that parties
are not suspended or debarred.
Prevalence:
There was no documentation available for seven out of seven of selections tested. However,
none of the vendors selected for testing were suspended or debarred.
Questioned Cost:
None
Repeat Finding:
No
Recommendation:
We recommend that the City implement a policy to formally document the procedures they are
performing to demonstrate compliance with the Single Audit Act occurred or that no issues were
noted as a result of performing the verification procedures.
Views of Responsible Officials:
Management agrees with the finding.