2023-003 – Procurement, Suspension and Debarment
Federal program information:
Funding Agency: U.S. Departments of the Interior
Title: Bureau of Indian Affairs Self-Governance
Assistance Listing Number: 15.022
Award Periods: January 1, 2023 – December 31, 2023
Criteria: Uniform Guidance regulations section CFR 200.318(a) and CFR 200.320(a) state, the non-Federal entity must use its own documented procurement procedures which reflect applicable state, local, and tribal laws and regulations, provided that the procurement conform to applicable federal law and the standards identified. Procurement by micro-purchase is the acquisition of supplies or services, the aggregate dollar amount of which does not exceed the micro-purchase threshold. During 2023, the Department’s procurement policy has a micro purchase threshold of $10,000. The Department’s policy states “Duckwater will conduct procurement in a manner that prohibits the use of statutorily or administratively imposed data, local, or tribal geographical preferences in the evaluation of bids or proposals”.
Recipients of federal awards must not contract with or make sub-awards to parties that are suspended or debarred. Contractors receiving individual awards for $25,000 or more and all sub-recipients must certify that the organization and its principals are not suspended or debarred. This verification may be accomplished by checking the Systems for Award Management (SAM) website, collecting a certification from the entity, or adding a clause or condition to the covered transaction with that entity.
Condition: The Department does not have a policy in place to ensure vendors are not suspended or disbarred. In addition, we reviewed two vendors that were paid in excess of $10,000; however, we were not provided with procurement documentation for these purchases.
Context: Two of thirty-five expenditures tested.
Questioned Costs: None.
Cause: The Department’s procurement policies and procedures were not enforced during the year. In addition, the Department did not have suspension and debarment policies and procedures established during the year.
Effect: The Department is not always ensuring that all goods and services are obtained at a fair price and the Department is not in compliance with their procurement policy. Lastly, the Department is not ensuring that vendors doing business under federal awards are properly reviewed for suspension and debarment.
Auditors’ Recommendation: Enforce procurement policies and procedures at all times. In addition, the Department should add a suspension and debarment policy to their policies and procedures. This verification may be accomplished by checking the Systems for Award Management (SAM) website, collecting a certification from the entity, or adding a clause or condition to the covered transaction with that entity.
Management Response: Management believes that the procurement process has improved during the last year. The threshold for obtaining quotes was raised to $10,000 from $2,000, so there are significantly fewer transactions to monitor for compliance. The program managers are practicing more price comparison and obtaining quotes for purchases over $10,000, but not in every instance. The Finance Manager and the Accounts Payable Clerk will continue to monitor the documents submitted with purchase requests. Finance will not issue a check for payment to a vendor over $10,000, unless an adequate number of quotes and/or a sole source justification for the purchase has been submitted to document compliance with procurement standards.
For purchase requests over $10,000, the Finance Manager will perform a search of the database records on Sam.gov to determine if a vendor has been suspended or debarred. The Finance Manager will note on the purchase request the status of the organization according to Sam.gov and the date of the search. For those entities that are determined to be suspended or debarred, the purchase will not be approved.
2023-004 – Schedule of Expenditures of Federal Awards
Federal program information:
Funding Agency: All major program funding agencies
Title: All major programs
Assistance Listing Number: All major program ALN’s
Award Periods: All major program award periods
Criteria: 2 CFR section 200.510 (b), requires the Department to prepare a schedule of expenditures of federal awards (SEFA) for the period covered by the Department’s financial statements and the SEFA must include the total awards expended as determined in accordance with 2 CFR §200.502.
Condition: Certain federal programs on the SEFA had inaccurate Assistance Listing Numbers (ALN) and/or ALN’s were not included on the initial client prepared SEFA. In addition, several audit adjustments were needed to correct the expenditures reported on the SEFA. Lastly, significant adjustments were needed to correct the ending and beginning receivable/unearned revenue balances.
Context: N/A
Questioned Costs: None.
Cause: Internal controls were not designed and implemented to ensure accurate preparation of the SEFA.
Effect: Revisions were needed to accurately prepare the SEFA by ALN and to ensure expenditures and receivable/unearned revenue balances were properly reported. Without proper internal controls there is the risk that errors and misstatements could exist and not be prevented or detected and corrected on a timely basis.
Auditors’ Recommendation: Internal control procedures should be established to ensure that an accurate SEFA is prepared in accordance with 2 CFR §200.502. The SEFA should be reviewed by someone independent from the preparer to verify the accuracy of the information.
Management Response: The Department will work with their accounting consultant to properly prepare the SEFA. The Department will verify all Assistance Listing Numbers and make all necessary adjustments prior to submitting the SEFA to the auditors.
2023-003 – Procurement, Suspension and Debarment
Federal program information:
Funding Agency: U.S. Departments of the Interior
Title: Bureau of Indian Affairs Self-Governance
Assistance Listing Number: 15.022
Award Periods: January 1, 2023 – December 31, 2023
Criteria: Uniform Guidance regulations section CFR 200.318(a) and CFR 200.320(a) state, the non-Federal entity must use its own documented procurement procedures which reflect applicable state, local, and tribal laws and regulations, provided that the procurement conform to applicable federal law and the standards identified. Procurement by micro-purchase is the acquisition of supplies or services, the aggregate dollar amount of which does not exceed the micro-purchase threshold. During 2023, the Department’s procurement policy has a micro purchase threshold of $10,000. The Department’s policy states “Duckwater will conduct procurement in a manner that prohibits the use of statutorily or administratively imposed data, local, or tribal geographical preferences in the evaluation of bids or proposals”.
Recipients of federal awards must not contract with or make sub-awards to parties that are suspended or debarred. Contractors receiving individual awards for $25,000 or more and all sub-recipients must certify that the organization and its principals are not suspended or debarred. This verification may be accomplished by checking the Systems for Award Management (SAM) website, collecting a certification from the entity, or adding a clause or condition to the covered transaction with that entity.
Condition: The Department does not have a policy in place to ensure vendors are not suspended or disbarred. In addition, we reviewed two vendors that were paid in excess of $10,000; however, we were not provided with procurement documentation for these purchases.
Context: Two of thirty-five expenditures tested.
Questioned Costs: None.
Cause: The Department’s procurement policies and procedures were not enforced during the year. In addition, the Department did not have suspension and debarment policies and procedures established during the year.
Effect: The Department is not always ensuring that all goods and services are obtained at a fair price and the Department is not in compliance with their procurement policy. Lastly, the Department is not ensuring that vendors doing business under federal awards are properly reviewed for suspension and debarment.
Auditors’ Recommendation: Enforce procurement policies and procedures at all times. In addition, the Department should add a suspension and debarment policy to their policies and procedures. This verification may be accomplished by checking the Systems for Award Management (SAM) website, collecting a certification from the entity, or adding a clause or condition to the covered transaction with that entity.
Management Response: Management believes that the procurement process has improved during the last year. The threshold for obtaining quotes was raised to $10,000 from $2,000, so there are significantly fewer transactions to monitor for compliance. The program managers are practicing more price comparison and obtaining quotes for purchases over $10,000, but not in every instance. The Finance Manager and the Accounts Payable Clerk will continue to monitor the documents submitted with purchase requests. Finance will not issue a check for payment to a vendor over $10,000, unless an adequate number of quotes and/or a sole source justification for the purchase has been submitted to document compliance with procurement standards.
For purchase requests over $10,000, the Finance Manager will perform a search of the database records on Sam.gov to determine if a vendor has been suspended or debarred. The Finance Manager will note on the purchase request the status of the organization according to Sam.gov and the date of the search. For those entities that are determined to be suspended or debarred, the purchase will not be approved.
2023-004 – Schedule of Expenditures of Federal Awards
Federal program information:
Funding Agency: All major program funding agencies
Title: All major programs
Assistance Listing Number: All major program ALN’s
Award Periods: All major program award periods
Criteria: 2 CFR section 200.510 (b), requires the Department to prepare a schedule of expenditures of federal awards (SEFA) for the period covered by the Department’s financial statements and the SEFA must include the total awards expended as determined in accordance with 2 CFR §200.502.
Condition: Certain federal programs on the SEFA had inaccurate Assistance Listing Numbers (ALN) and/or ALN’s were not included on the initial client prepared SEFA. In addition, several audit adjustments were needed to correct the expenditures reported on the SEFA. Lastly, significant adjustments were needed to correct the ending and beginning receivable/unearned revenue balances.
Context: N/A
Questioned Costs: None.
Cause: Internal controls were not designed and implemented to ensure accurate preparation of the SEFA.
Effect: Revisions were needed to accurately prepare the SEFA by ALN and to ensure expenditures and receivable/unearned revenue balances were properly reported. Without proper internal controls there is the risk that errors and misstatements could exist and not be prevented or detected and corrected on a timely basis.
Auditors’ Recommendation: Internal control procedures should be established to ensure that an accurate SEFA is prepared in accordance with 2 CFR §200.502. The SEFA should be reviewed by someone independent from the preparer to verify the accuracy of the information.
Management Response: The Department will work with their accounting consultant to properly prepare the SEFA. The Department will verify all Assistance Listing Numbers and make all necessary adjustments prior to submitting the SEFA to the auditors.
2023-002 – Character Investigations
Federal program information:
Funding Agency: U.S. Department of Health and Human Services
Title: Indian Health Services Self-Governance
Assistance Listing Number: 93.210
Award Period: January 1, 2023 – December 31, 2023
Criteria: The Indian Child Protection and Family Violence Prevention Act (25 USC 3207) requires tribes and tribal organizations that receive funds under the ISDEAA to conduct character investigations of any employee or person who will be employed if their duties will involve regular contact with children. The Act further states that the tribe or tribal organization can employ only individuals who meet standards of character that are no less stringent than those prescribed by the regulations, which are outlined in 42 CFR section 136.405, and only after an individual has been the subject of a satisfactory background investigation.
Condition: The Department does not have policies and procedures in place covering character investigations. During our review of employee files, all five employee files tested did not have evidence of a character investigation.
Context: Five of five files tested.
Questioned Costs: None.
Cause: Policies and procedures are not in place to ensure employees in contact with children have character investigations completed.
Effect: The program described above is not in compliance with character investigation requirements.
Auditors’ Recommendation: Policies and procedures should be designed and implemented to require all individuals in contact with children to undergo a character investigation prior to being hired. Ensure the policies are enforced once adopted.
Management Response: The Department completes character investigations for school and daycare employees, but did not initiate the practice of completing character investigations for health clinic employees until 2024. The Department will develop and implement a policy and procedures for character investigations that is compliant with the Indian Child Protection and Family Violence Prevention Act. For employees that have regular contact with children, the Department will only employ individuals who have been the subject of a satisfactory background check.
2023-004 – Schedule of Expenditures of Federal Awards
Federal program information:
Funding Agency: All major program funding agencies
Title: All major programs
Assistance Listing Number: All major program ALN’s
Award Periods: All major program award periods
Criteria: 2 CFR section 200.510 (b), requires the Department to prepare a schedule of expenditures of federal awards (SEFA) for the period covered by the Department’s financial statements and the SEFA must include the total awards expended as determined in accordance with 2 CFR §200.502.
Condition: Certain federal programs on the SEFA had inaccurate Assistance Listing Numbers (ALN) and/or ALN’s were not included on the initial client prepared SEFA. In addition, several audit adjustments were needed to correct the expenditures reported on the SEFA. Lastly, significant adjustments were needed to correct the ending and beginning receivable/unearned revenue balances.
Context: N/A
Questioned Costs: None.
Cause: Internal controls were not designed and implemented to ensure accurate preparation of the SEFA.
Effect: Revisions were needed to accurately prepare the SEFA by ALN and to ensure expenditures and receivable/unearned revenue balances were properly reported. Without proper internal controls there is the risk that errors and misstatements could exist and not be prevented or detected and corrected on a timely basis.
Auditors’ Recommendation: Internal control procedures should be established to ensure that an accurate SEFA is prepared in accordance with 2 CFR §200.502. The SEFA should be reviewed by someone independent from the preparer to verify the accuracy of the information.
Management Response: The Department will work with their accounting consultant to properly prepare the SEFA. The Department will verify all Assistance Listing Numbers and make all necessary adjustments prior to submitting the SEFA to the auditors.
2023-003 – Procurement, Suspension and Debarment
Federal program information:
Funding Agency: U.S. Departments of the Interior
Title: Bureau of Indian Affairs Self-Governance
Assistance Listing Number: 15.022
Award Periods: January 1, 2023 – December 31, 2023
Criteria: Uniform Guidance regulations section CFR 200.318(a) and CFR 200.320(a) state, the non-Federal entity must use its own documented procurement procedures which reflect applicable state, local, and tribal laws and regulations, provided that the procurement conform to applicable federal law and the standards identified. Procurement by micro-purchase is the acquisition of supplies or services, the aggregate dollar amount of which does not exceed the micro-purchase threshold. During 2023, the Department’s procurement policy has a micro purchase threshold of $10,000. The Department’s policy states “Duckwater will conduct procurement in a manner that prohibits the use of statutorily or administratively imposed data, local, or tribal geographical preferences in the evaluation of bids or proposals”.
Recipients of federal awards must not contract with or make sub-awards to parties that are suspended or debarred. Contractors receiving individual awards for $25,000 or more and all sub-recipients must certify that the organization and its principals are not suspended or debarred. This verification may be accomplished by checking the Systems for Award Management (SAM) website, collecting a certification from the entity, or adding a clause or condition to the covered transaction with that entity.
Condition: The Department does not have a policy in place to ensure vendors are not suspended or disbarred. In addition, we reviewed two vendors that were paid in excess of $10,000; however, we were not provided with procurement documentation for these purchases.
Context: Two of thirty-five expenditures tested.
Questioned Costs: None.
Cause: The Department’s procurement policies and procedures were not enforced during the year. In addition, the Department did not have suspension and debarment policies and procedures established during the year.
Effect: The Department is not always ensuring that all goods and services are obtained at a fair price and the Department is not in compliance with their procurement policy. Lastly, the Department is not ensuring that vendors doing business under federal awards are properly reviewed for suspension and debarment.
Auditors’ Recommendation: Enforce procurement policies and procedures at all times. In addition, the Department should add a suspension and debarment policy to their policies and procedures. This verification may be accomplished by checking the Systems for Award Management (SAM) website, collecting a certification from the entity, or adding a clause or condition to the covered transaction with that entity.
Management Response: Management believes that the procurement process has improved during the last year. The threshold for obtaining quotes was raised to $10,000 from $2,000, so there are significantly fewer transactions to monitor for compliance. The program managers are practicing more price comparison and obtaining quotes for purchases over $10,000, but not in every instance. The Finance Manager and the Accounts Payable Clerk will continue to monitor the documents submitted with purchase requests. Finance will not issue a check for payment to a vendor over $10,000, unless an adequate number of quotes and/or a sole source justification for the purchase has been submitted to document compliance with procurement standards.
For purchase requests over $10,000, the Finance Manager will perform a search of the database records on Sam.gov to determine if a vendor has been suspended or debarred. The Finance Manager will note on the purchase request the status of the organization according to Sam.gov and the date of the search. For those entities that are determined to be suspended or debarred, the purchase will not be approved.
2023-004 – Schedule of Expenditures of Federal Awards
Federal program information:
Funding Agency: All major program funding agencies
Title: All major programs
Assistance Listing Number: All major program ALN’s
Award Periods: All major program award periods
Criteria: 2 CFR section 200.510 (b), requires the Department to prepare a schedule of expenditures of federal awards (SEFA) for the period covered by the Department’s financial statements and the SEFA must include the total awards expended as determined in accordance with 2 CFR §200.502.
Condition: Certain federal programs on the SEFA had inaccurate Assistance Listing Numbers (ALN) and/or ALN’s were not included on the initial client prepared SEFA. In addition, several audit adjustments were needed to correct the expenditures reported on the SEFA. Lastly, significant adjustments were needed to correct the ending and beginning receivable/unearned revenue balances.
Context: N/A
Questioned Costs: None.
Cause: Internal controls were not designed and implemented to ensure accurate preparation of the SEFA.
Effect: Revisions were needed to accurately prepare the SEFA by ALN and to ensure expenditures and receivable/unearned revenue balances were properly reported. Without proper internal controls there is the risk that errors and misstatements could exist and not be prevented or detected and corrected on a timely basis.
Auditors’ Recommendation: Internal control procedures should be established to ensure that an accurate SEFA is prepared in accordance with 2 CFR §200.502. The SEFA should be reviewed by someone independent from the preparer to verify the accuracy of the information.
Management Response: The Department will work with their accounting consultant to properly prepare the SEFA. The Department will verify all Assistance Listing Numbers and make all necessary adjustments prior to submitting the SEFA to the auditors.
2023-003 – Procurement, Suspension and Debarment
Federal program information:
Funding Agency: U.S. Departments of the Interior
Title: Bureau of Indian Affairs Self-Governance
Assistance Listing Number: 15.022
Award Periods: January 1, 2023 – December 31, 2023
Criteria: Uniform Guidance regulations section CFR 200.318(a) and CFR 200.320(a) state, the non-Federal entity must use its own documented procurement procedures which reflect applicable state, local, and tribal laws and regulations, provided that the procurement conform to applicable federal law and the standards identified. Procurement by micro-purchase is the acquisition of supplies or services, the aggregate dollar amount of which does not exceed the micro-purchase threshold. During 2023, the Department’s procurement policy has a micro purchase threshold of $10,000. The Department’s policy states “Duckwater will conduct procurement in a manner that prohibits the use of statutorily or administratively imposed data, local, or tribal geographical preferences in the evaluation of bids or proposals”.
Recipients of federal awards must not contract with or make sub-awards to parties that are suspended or debarred. Contractors receiving individual awards for $25,000 or more and all sub-recipients must certify that the organization and its principals are not suspended or debarred. This verification may be accomplished by checking the Systems for Award Management (SAM) website, collecting a certification from the entity, or adding a clause or condition to the covered transaction with that entity.
Condition: The Department does not have a policy in place to ensure vendors are not suspended or disbarred. In addition, we reviewed two vendors that were paid in excess of $10,000; however, we were not provided with procurement documentation for these purchases.
Context: Two of thirty-five expenditures tested.
Questioned Costs: None.
Cause: The Department’s procurement policies and procedures were not enforced during the year. In addition, the Department did not have suspension and debarment policies and procedures established during the year.
Effect: The Department is not always ensuring that all goods and services are obtained at a fair price and the Department is not in compliance with their procurement policy. Lastly, the Department is not ensuring that vendors doing business under federal awards are properly reviewed for suspension and debarment.
Auditors’ Recommendation: Enforce procurement policies and procedures at all times. In addition, the Department should add a suspension and debarment policy to their policies and procedures. This verification may be accomplished by checking the Systems for Award Management (SAM) website, collecting a certification from the entity, or adding a clause or condition to the covered transaction with that entity.
Management Response: Management believes that the procurement process has improved during the last year. The threshold for obtaining quotes was raised to $10,000 from $2,000, so there are significantly fewer transactions to monitor for compliance. The program managers are practicing more price comparison and obtaining quotes for purchases over $10,000, but not in every instance. The Finance Manager and the Accounts Payable Clerk will continue to monitor the documents submitted with purchase requests. Finance will not issue a check for payment to a vendor over $10,000, unless an adequate number of quotes and/or a sole source justification for the purchase has been submitted to document compliance with procurement standards.
For purchase requests over $10,000, the Finance Manager will perform a search of the database records on Sam.gov to determine if a vendor has been suspended or debarred. The Finance Manager will note on the purchase request the status of the organization according to Sam.gov and the date of the search. For those entities that are determined to be suspended or debarred, the purchase will not be approved.
2023-004 – Schedule of Expenditures of Federal Awards
Federal program information:
Funding Agency: All major program funding agencies
Title: All major programs
Assistance Listing Number: All major program ALN’s
Award Periods: All major program award periods
Criteria: 2 CFR section 200.510 (b), requires the Department to prepare a schedule of expenditures of federal awards (SEFA) for the period covered by the Department’s financial statements and the SEFA must include the total awards expended as determined in accordance with 2 CFR §200.502.
Condition: Certain federal programs on the SEFA had inaccurate Assistance Listing Numbers (ALN) and/or ALN’s were not included on the initial client prepared SEFA. In addition, several audit adjustments were needed to correct the expenditures reported on the SEFA. Lastly, significant adjustments were needed to correct the ending and beginning receivable/unearned revenue balances.
Context: N/A
Questioned Costs: None.
Cause: Internal controls were not designed and implemented to ensure accurate preparation of the SEFA.
Effect: Revisions were needed to accurately prepare the SEFA by ALN and to ensure expenditures and receivable/unearned revenue balances were properly reported. Without proper internal controls there is the risk that errors and misstatements could exist and not be prevented or detected and corrected on a timely basis.
Auditors’ Recommendation: Internal control procedures should be established to ensure that an accurate SEFA is prepared in accordance with 2 CFR §200.502. The SEFA should be reviewed by someone independent from the preparer to verify the accuracy of the information.
Management Response: The Department will work with their accounting consultant to properly prepare the SEFA. The Department will verify all Assistance Listing Numbers and make all necessary adjustments prior to submitting the SEFA to the auditors.
2023-002 – Character Investigations
Federal program information:
Funding Agency: U.S. Department of Health and Human Services
Title: Indian Health Services Self-Governance
Assistance Listing Number: 93.210
Award Period: January 1, 2023 – December 31, 2023
Criteria: The Indian Child Protection and Family Violence Prevention Act (25 USC 3207) requires tribes and tribal organizations that receive funds under the ISDEAA to conduct character investigations of any employee or person who will be employed if their duties will involve regular contact with children. The Act further states that the tribe or tribal organization can employ only individuals who meet standards of character that are no less stringent than those prescribed by the regulations, which are outlined in 42 CFR section 136.405, and only after an individual has been the subject of a satisfactory background investigation.
Condition: The Department does not have policies and procedures in place covering character investigations. During our review of employee files, all five employee files tested did not have evidence of a character investigation.
Context: Five of five files tested.
Questioned Costs: None.
Cause: Policies and procedures are not in place to ensure employees in contact with children have character investigations completed.
Effect: The program described above is not in compliance with character investigation requirements.
Auditors’ Recommendation: Policies and procedures should be designed and implemented to require all individuals in contact with children to undergo a character investigation prior to being hired. Ensure the policies are enforced once adopted.
Management Response: The Department completes character investigations for school and daycare employees, but did not initiate the practice of completing character investigations for health clinic employees until 2024. The Department will develop and implement a policy and procedures for character investigations that is compliant with the Indian Child Protection and Family Violence Prevention Act. For employees that have regular contact with children, the Department will only employ individuals who have been the subject of a satisfactory background check.
2023-004 – Schedule of Expenditures of Federal Awards
Federal program information:
Funding Agency: All major program funding agencies
Title: All major programs
Assistance Listing Number: All major program ALN’s
Award Periods: All major program award periods
Criteria: 2 CFR section 200.510 (b), requires the Department to prepare a schedule of expenditures of federal awards (SEFA) for the period covered by the Department’s financial statements and the SEFA must include the total awards expended as determined in accordance with 2 CFR §200.502.
Condition: Certain federal programs on the SEFA had inaccurate Assistance Listing Numbers (ALN) and/or ALN’s were not included on the initial client prepared SEFA. In addition, several audit adjustments were needed to correct the expenditures reported on the SEFA. Lastly, significant adjustments were needed to correct the ending and beginning receivable/unearned revenue balances.
Context: N/A
Questioned Costs: None.
Cause: Internal controls were not designed and implemented to ensure accurate preparation of the SEFA.
Effect: Revisions were needed to accurately prepare the SEFA by ALN and to ensure expenditures and receivable/unearned revenue balances were properly reported. Without proper internal controls there is the risk that errors and misstatements could exist and not be prevented or detected and corrected on a timely basis.
Auditors’ Recommendation: Internal control procedures should be established to ensure that an accurate SEFA is prepared in accordance with 2 CFR §200.502. The SEFA should be reviewed by someone independent from the preparer to verify the accuracy of the information.
Management Response: The Department will work with their accounting consultant to properly prepare the SEFA. The Department will verify all Assistance Listing Numbers and make all necessary adjustments prior to submitting the SEFA to the auditors.