Volunteers of America of Colorado

Assistance Listing, Federal Agency, and Program Name - 21.027, U.S. Department of Treasury, COVID 19 Coronavirus State and Local Fiscal Recovery Funds Federal Award Identification Number and Year - H4HRGP33345 Pass-through Entity - State of Colorado, Department of Local Affairs, for the benefit of the Division of Housing Finding Type - Material weakness Repeat Finding - No Criteria - Per 2 CFR 200.303, the recipient must establish, document, and maintain effective internal control over the federal award that provides reasonable assurance that the recipient or subrecipient is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. These internal controls should align with the guidance in “Standards for Internal Control in the Federal Government,” issued by the Comptroller General of the United States, or the “Internal Control Integrated Framework," issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition - Management did not have controls in place to ensure documentation was maintained evidencing the organization's verfication that contractors are not suspended or debarred from participating in a federally funded activity. Questioned Costs - N/A If questioned costs are not determinable, description of why known questioned costs were undetermined or otherwise could not be reported - N/A Identification of How Questioned Costs Were Computed - N/A Context - While gaining an understanding of the organization's internal controls, we noted management was unable to provide documentation to support that checks for suspension and debarment occurred before the organization entered into a covered transaction. We were able to verify in our sample testing that management did not enter into contracts with individuals or organizations suspended or debarred from participating in federal programs. Cause and Effect - A lack of controls could result in material noncompliance with federal procurement standards. Recommendation - We recommend management retain documented evidence that checks for suspension and debarment have occurred before entering into a covered transaction with outside contractors. Views of Responsible Officials and Corrective Action Plan - Management concurs with the finding. We acknowledge that, for one federal program under the Coronavirus State and Local Fiscal Recovery Funds program (Assistance Listing 21.027), the required suspension and debarment verification was performed; however, the supporting documentation evidencing this verification was not retained in the contract file. This represents a documentation lapse rather than a control deficiency. Volunteers of America Colorado (VOAC) routinely performs suspension and debarment verifications for all applicable vendors, contractors, and subrecipients receiving federal funds in accordance with 2 CFR 200.214. This requirement applies to entities and individuals awarded federally funded contracts or subawards exceeding the micro purchase threshold and excludes routine commercial vendors for indirect administrative costs or purchases under $10,000. To strengthen compliance documentation and ensure consistent audit support, VOAC has implemented the following corrective actions: 1.Policy Enhancement: The procurement procedure has been updated to explicitly require saving and retaining a time stamped screenshot or PDF confirmation of each SAM.gov verification showing the verification date and results. Where applicable, contractors subject to 2 CFR 200.214 must also provide a self certification statement within the executed agreement. 2.Centralized Recordkeeping: Verification evidence will be maintained in both the individual contract file and the centralized grant management system. 3.Annual Training and Refresher: Procurement and grants management staff will participate in annual training to reinforce 2 CFR 200.214 requirements and best practices for documentation and record retention. Management believes this was an isolated documentation lapse prior to the current audit period when the contractor was selected, and that the actions taken since have resolved the issue and will ensure continued compliance.