Audit 364476

Cluster: Not applicable Federal Granting Agency: Department of Treasury Pass Through Entity: Indiana Department of Health Award Name: COVID-19 – Coronavirus State and Local Fiscal Recovery Funds Award Year: 2024 Assistance Listing #: 21.027 Federal Award Identification Number: Contract#0000000000000000000065435 Criteria In accordance with 2 CFR 200.320(c) and Franciscan's policy, vendors above a micro-purchase threshold ($10,000 based on Franciscan’s policy) require a competitive process that includes soliciting multiple bids/quotes to justify best value, unless a sole sourcing method is justified. The Uniform Guidance requires purchasing decisions to be documented, including sole source justification, as applicable. Condition We identified one vendor with sole source transactions totaling $60,192 for which a purchase order was dated in March 2024. Sole source justification documentation was not prepared at the time of procurement in March 2024, but rather was prepared in April 2025. Cause Management did not timely prepare sole source justification related to one vendor prior to procurement of services. Effect The lack of a competitive procurement process, or a sole sourcing justification, could lead to Franciscan experiencing management bias in vendor selection or to miss out on better prospective vendors to do business with. Questioned Costs None noted. Recommendation We recommend that Franciscan enhance its internal control around the adherence to procurement methods established within the Uniform Guidance, and within Franciscan’s procurement policies, including the performance, and documentation of, the required justification for performing a sole sourcing procurement ensuring timeliness of procurement procedures and documentation. Management’s Views and Corrective Action Plan Management’s views and corrective action plan is included at the end of this report after the summary schedule of prior audit findings and status.

Cluster: Not applicable Federal Granting Agency: Department of Treasury Pass Through Entity: Indiana Department of Health Award Name: COVID-19 – Coronavirus State and Local Fiscal Recovery Funds Award Year: 2024 Assistance Listing #: 21.027 Federal Award Identification Number: Contract#0000000000000000000065435 Criteria In accordance with 2 CFR 200.320(c) and Franciscan's policy, vendors above a micro-purchase threshold ($10,000 based on Franciscan’s policy) require a competitive process that includes soliciting multiple bids/quotes to justify best value, unless a sole sourcing method is justified. The Uniform Guidance requires purchasing decisions to be documented, including sole source justification, as applicable. Condition We identified one vendor with sole source transactions totaling $60,192 for which a purchase order was dated in March 2024. Sole source justification documentation was not prepared at the time of procurement in March 2024, but rather was prepared in April 2025. Cause Management did not timely prepare sole source justification related to one vendor prior to procurement of services. Effect The lack of a competitive procurement process, or a sole sourcing justification, could lead to Franciscan experiencing management bias in vendor selection or to miss out on better prospective vendors to do business with. Questioned Costs None noted. Recommendation We recommend that Franciscan enhance its internal control around the adherence to procurement methods established within the Uniform Guidance, and within Franciscan’s procurement policies, including the performance, and documentation of, the required justification for performing a sole sourcing procurement ensuring timeliness of procurement procedures and documentation. Management’s Views and Corrective Action Plan Management’s views and corrective action plan is included at the end of this report after the summary schedule of prior audit findings and status.