Audit 358522

Criteria The Organization is required to perform and document suspension and debarment searches for potential vendors prior to procuring services. If bids are not obtained in accordance with the Organization’s procurement procedures due to using the noncompetitive procurement method, documentation must be prepared and retained including justification for sole-source procurement. Condition Evidence was not in place to ensure that the Organization is abiding by the suspension and debarment searches for potential vendors or sole-source procurement in accordance with 2 CFR Part 200. Context During the year ended May 31, 2024, the Organization engaged a single contractor for this program. Upon testing this contractor, we found that the Organization lacked documentation to demonstrate that the suspension and debarment verification procedures and sole-source procurement procedures, as outlined in the Organization’s procurement policy, were conducted to securing the services. Consequently, we could not conclude that these procedures were performed in a timely manner. The Organization incurred expenditures totaling $264,628 with this contractor during the year ended May 31, 2024. The remaining program expenditures of $8,791,324 were payroll-related and not subject to procurement requirements. Cause The Organization was not aware of the necessity to maintain the documentation of its suspension and debarment search and sole-source justification procedures. Effect Without abidance of the documentation requirements of 2 CFR Part 200, there is an increased risk that procurement activities may not be conducted in compliance with federal requirements, potentially leading to unallowable costs or questioned costs. Questioned Costs None due to auditor agreeing with verbal justification of the sole-source procurement. Repeat Finding Documentation to support that the Organization’s suspension and debarment verification procedures were performed prior to procuring services is a repeat finding. Recommendation We recommend that management ensure all procurement policy requirements are performed and documented prior to entering into procurement transactions. Views of Responsible Officials and Planned Corrective Actions See Corrective Action Plan.

Criteria The Organization is required to submit request for payment reports by the end of the month following the month to be reimbursed per the grant agreement. Condition There are inadequate internal controls in place to ensure that the Organization’s financial reports are submitted to the grantor in a timely manner. Context For two of the three months tested, the Organization did not submit the monthly request for payment reports in a timely manner. Cause The Organization received verbal, undocumented, approval from the grantor to submit the monthly request for payment reports subsequent to the due date. Effect Failure to comply with reporting requirements can result in non-compliance with federal award terms, which may lead to questioned costs, potential withholding of future funds, or other administrative actions by the federal awarding agency. Questioned Costs None. Repeat Finding No. Recommendation We recommend that management review its reporting procedures to ensure compliance with the reporting requirements of the Uniform Guidance and grant agreements. Any verbal approvals from the grantor regarding untimely reporting should be documented between the Organization and grantor. Views of Responsible Officials and Planned Corrective Actions See Corrective Action Plan.

Criteria The Organization is required to perform and document suspension and debarment searches for potential vendors prior to procuring services. If bids are not obtained in accordance with the Organization’s procurement procedures due to using the noncompetitive procurement method, documentation must be prepared and retained including justification for sole-source procurement. Condition Evidence was not in place to ensure that the Organization is abiding by the suspension and debarment searches for potential vendors or sole-source procurement in accordance with 2 CFR Part 200. Context During the year ended May 31, 2024, the Organization engaged a single contractor for this program. Upon testing this contractor, we found that the Organization lacked documentation to demonstrate that the suspension and debarment verification procedures and sole-source procurement procedures, as outlined in the Organization’s procurement policy, were conducted to securing the services. Consequently, we could not conclude that these procedures were performed in a timely manner. The Organization incurred expenditures totaling $264,628 with this contractor during the year ended May 31, 2024. The remaining program expenditures of $8,791,324 were payroll-related and not subject to procurement requirements. Cause The Organization was not aware of the necessity to maintain the documentation of its suspension and debarment search and sole-source justification procedures. Effect Without abidance of the documentation requirements of 2 CFR Part 200, there is an increased risk that procurement activities may not be conducted in compliance with federal requirements, potentially leading to unallowable costs or questioned costs. Questioned Costs None due to auditor agreeing with verbal justification of the sole-source procurement. Repeat Finding Documentation to support that the Organization’s suspension and debarment verification procedures were performed prior to procuring services is a repeat finding. Recommendation We recommend that management ensure all procurement policy requirements are performed and documented prior to entering into procurement transactions. Views of Responsible Officials and Planned Corrective Actions See Corrective Action Plan.

Criteria The Organization is required to submit request for payment reports by the end of the month following the month to be reimbursed per the grant agreement. Condition There are inadequate internal controls in place to ensure that the Organization’s financial reports are submitted to the grantor in a timely manner. Context For two of the three months tested, the Organization did not submit the monthly request for payment reports in a timely manner. Cause The Organization received verbal, undocumented, approval from the grantor to submit the monthly request for payment reports subsequent to the due date. Effect Failure to comply with reporting requirements can result in non-compliance with federal award terms, which may lead to questioned costs, potential withholding of future funds, or other administrative actions by the federal awarding agency. Questioned Costs None. Repeat Finding No. Recommendation We recommend that management review its reporting procedures to ensure compliance with the reporting requirements of the Uniform Guidance and grant agreements. Any verbal approvals from the grantor regarding untimely reporting should be documented between the Organization and grantor. Views of Responsible Officials and Planned Corrective Actions See Corrective Action Plan.