Audit 365948

Finding 2024-001 Significant deficiency in internal controls over financial reporting in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP). Criteria Internal controls over financial reporting should be in place to ensure proper reconciliations are being performed to ensure transactions are recorded in accordance with U.S. GAAP. Condition/Context During our audit, we noted that a significant amount of donor restrictions had been met in prior years but not released in those years. Effect/Potential Effect As a result, a prior period adjustment had to be booked to reclass $655,000 from net assets with donor restrictions to net assets without donor restrictions. Cause In the prior year, a year end review of restricted net assets was not performed to assess termed awards or to compare year end restricted net asset balances against expectations based on expenditures to date. Repeat Finding No Recommendation We recommend that PDA implement necessary internal controls to ensure that donor restricted balances are reviewed as part of year end close processes to determine if restrictions have been met and amounts should be released from restriction. Views of Responsible Officials Management agrees with the finding and has provided the corrective action plan following the Single Audit Report.

Finding 2024-002 Significant deficiency in internal controls over financial reporting in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP). Criteria Internal controls over financial reporting should ensure that leases are identified, evaluated, and recorded in accordance with U.S. GAAP, including the recognition of right-of-use assets and lease liabilities, and appropriate classification and disclosure under ASC 842. Condition/Context For the year ended December 31, 2024, the modifications of two leases were incorrectly recorded as if the modifications were present at inception of the leases rather than as of the date of the modification, and one new lease was not recorded as required by ASC 842. Effect/Potential Effect As a result, an adjustment of $41,184 was needed to lease expense, a $40,690 adjustment was needed for lease liabilities, and a $494 adjustment was needed for the right-of-use asset to properly state the financial statements in accordance with US. GAAP. Cause The lease modifications were recorded incorrectly due to a misunderstanding of how the lease accounting software distinguishes between lease edits and lease modifications. Amendments resulting in term extensions are considered triggering events and are recorded as modifications effective on the amendment date. Instead, the original lease terms were edited directly, which prompted the lease accounting software to produce improper calculations. Additionally, a new lease signed during the audit year was initially treated as a short-term lease and not capitalized under ASC 842 based on the expectation that it would be canceled partway through its term. However, no formal amendment was executed to document the early termination. As a result, a right-of-use asset and lease liability were not recorded as required by ASC 842. Repeat Finding No Recommendation We recommend that PDA implement necessary internal controls and review to ensure that lease modifications and new leases are properly recorded in accordance with ASC 842 when executed. Views of Responsible Officials Management agrees with the finding and has provided the corrective action plan following the Single Audit Report.

Finding 2024-003 Material weakness in internal control over compliance with procurement procedures meeting the requirements of 2 CFR Part 200. Federal Agency: Department of Health and Human Services Program Titles: Community Funded Projects Assistance Listing Number: 93.493 Pass-Through Entity: N/A Award Numbers: H79FG001026 and H79FG001037 Award Periods: September 30, 2023 through September 29, 2024 Criteria Internal controls requirements contained in Title 2 U.S. Code of Federal Regulations Uniform Administrative Requirements, Cost Principles and Audit Requirements for Federal Awards (the Uniform Guidance) , Subpart D ‐ Post Federal Award Requirements, Section 200.318 through 200.326 Internal Controls, require that a non‐Federal entity use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. The procurement procedures must include the following: - Using the micro-purchase and small purchase methods only for procurements that meet the applicable criteria under 2 CFR sections 200.320(a) (1) and (2). Under the micro-purchase method, the aggregate dollar amount does not exceed $10,000 ($2,000 in the case of acquisition for construction subject to the Wage Rate Requirements (Davis-Bacon Act)). Small purchase procedures are used for purchases that exceed the micro-purchase amount but do not exceed the simplified acquisition threshold ($250,000). Micro-purchases may be awarded without soliciting competitive quotations if the nonfederal entity considers the price to be reasonable (2 CFR section 200.320(a)). If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources (2 CFR section 200.320(b)). - For acquisitions exceeding the simplified acquisition threshold, using one of the following procurement methods: the sealed bid method if the acquisition meets the criteria in 2 CFR section 200.320(b); the competitive proposals method under the conditions specified in 2 CFR section 200.320((b) (2); or the noncompetitive proposals method (i.e., solicit a proposal from only one source) but only when one or more of the circumstances are met, in accordance with 2 CFR section 200.320(c)). - Using Noncompetitive procurement only if one or more of the following circumstances apply: · The acquisition of property or services, the aggregate dollar amount of which does not exceed the micro-purchase threshold; · The item is available only from a single source; · The public exigency or emergency for the requirement will not permit a delay resulting from publicizing a competitive solicitation; · The Federal awarding agency or pass-through entity expressly authorizes a noncompetitive procurement in response to a written request from the nonfederal entity; or · After solicitation of a number of sources, competition is determined inadequate PDA’s procurement policy also requires a verification that vendors and sub-recipients are not suspended or debarred by checking the website of the System for Award Management and documentation of such verification maintained by the Finance Office. Condition/Context While PDA has established a procurement policy, it does not fully conform to Federal law and the Uniform Guidance for the following reasons: - Micro purchase threshold is not explicitly defined, although it is mentioned that cost and price analysis shall be made and documented in connection with every procurement action above $5,000. - The policy does not have clear provisions for maintaining detailed procurement records. Such records should include the rationale for the procurement method, the selection of contract type, the contractor selection or rejection process, and the basis for the contract price. - The simplified acquisition threshold is not defined and does not incorporate all relevant elements including sealed bids method. The total misstatement is the entire population amount $1,546,725 as PDA did not maintain sufficient documentation to evidence history of procurement for all procurements. Cause PDA’s procurement policy does not seem to have been reviewed against the Uniform Guidance for compliance. Internal controls over maintaining sufficient records to detail the history of procurement including noncompetitive justification and suspension and debarment verification were found to be insufficient. Effect The absence of a policy that fully conformed to the Uniform Guidance resulted in noncompliance issues such as records sufficient to detail the history of procurement transactions not maintained. Questioned Costs $1,546,725 Repeat Finding Yes Recommendation We recommend PDA implement measures to ensure that its procurement policy reflect applicable state and local laws and regulations conforming to applicable federal statutes and requirement in 2 CFR part 200. Management should ensure procurement transactions are documented in such detail to evidence the method of procurement use and vendor verification for suspension and debarment.

Finding 2024-001 Significant deficiency in internal controls over financial reporting in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP). Criteria Internal controls over financial reporting should be in place to ensure proper reconciliations are being performed to ensure transactions are recorded in accordance with U.S. GAAP. Condition/Context During our audit, we noted that a significant amount of donor restrictions had been met in prior years but not released in those years. Effect/Potential Effect As a result, a prior period adjustment had to be booked to reclass $655,000 from net assets with donor restrictions to net assets without donor restrictions. Cause In the prior year, a year end review of restricted net assets was not performed to assess termed awards or to compare year end restricted net asset balances against expectations based on expenditures to date. Repeat Finding No Recommendation We recommend that PDA implement necessary internal controls to ensure that donor restricted balances are reviewed as part of year end close processes to determine if restrictions have been met and amounts should be released from restriction. Views of Responsible Officials Management agrees with the finding and has provided the corrective action plan following the Single Audit Report.

Finding 2024-002 Significant deficiency in internal controls over financial reporting in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP). Criteria Internal controls over financial reporting should ensure that leases are identified, evaluated, and recorded in accordance with U.S. GAAP, including the recognition of right-of-use assets and lease liabilities, and appropriate classification and disclosure under ASC 842. Condition/Context For the year ended December 31, 2024, the modifications of two leases were incorrectly recorded as if the modifications were present at inception of the leases rather than as of the date of the modification, and one new lease was not recorded as required by ASC 842. Effect/Potential Effect As a result, an adjustment of $41,184 was needed to lease expense, a $40,690 adjustment was needed for lease liabilities, and a $494 adjustment was needed for the right-of-use asset to properly state the financial statements in accordance with US. GAAP. Cause The lease modifications were recorded incorrectly due to a misunderstanding of how the lease accounting software distinguishes between lease edits and lease modifications. Amendments resulting in term extensions are considered triggering events and are recorded as modifications effective on the amendment date. Instead, the original lease terms were edited directly, which prompted the lease accounting software to produce improper calculations. Additionally, a new lease signed during the audit year was initially treated as a short-term lease and not capitalized under ASC 842 based on the expectation that it would be canceled partway through its term. However, no formal amendment was executed to document the early termination. As a result, a right-of-use asset and lease liability were not recorded as required by ASC 842. Repeat Finding No Recommendation We recommend that PDA implement necessary internal controls and review to ensure that lease modifications and new leases are properly recorded in accordance with ASC 842 when executed. Views of Responsible Officials Management agrees with the finding and has provided the corrective action plan following the Single Audit Report.

Finding 2024-003 Material weakness in internal control over compliance with procurement procedures meeting the requirements of 2 CFR Part 200. Federal Agency: Department of Health and Human Services Program Titles: Community Funded Projects Assistance Listing Number: 93.493 Pass-Through Entity: N/A Award Numbers: H79FG001026 and H79FG001037 Award Periods: September 30, 2023 through September 29, 2024 Criteria Internal controls requirements contained in Title 2 U.S. Code of Federal Regulations Uniform Administrative Requirements, Cost Principles and Audit Requirements for Federal Awards (the Uniform Guidance) , Subpart D ‐ Post Federal Award Requirements, Section 200.318 through 200.326 Internal Controls, require that a non‐Federal entity use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. The procurement procedures must include the following: - Using the micro-purchase and small purchase methods only for procurements that meet the applicable criteria under 2 CFR sections 200.320(a) (1) and (2). Under the micro-purchase method, the aggregate dollar amount does not exceed $10,000 ($2,000 in the case of acquisition for construction subject to the Wage Rate Requirements (Davis-Bacon Act)). Small purchase procedures are used for purchases that exceed the micro-purchase amount but do not exceed the simplified acquisition threshold ($250,000). Micro-purchases may be awarded without soliciting competitive quotations if the nonfederal entity considers the price to be reasonable (2 CFR section 200.320(a)). If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources (2 CFR section 200.320(b)). - For acquisitions exceeding the simplified acquisition threshold, using one of the following procurement methods: the sealed bid method if the acquisition meets the criteria in 2 CFR section 200.320(b); the competitive proposals method under the conditions specified in 2 CFR section 200.320((b) (2); or the noncompetitive proposals method (i.e., solicit a proposal from only one source) but only when one or more of the circumstances are met, in accordance with 2 CFR section 200.320(c)). - Using Noncompetitive procurement only if one or more of the following circumstances apply: · The acquisition of property or services, the aggregate dollar amount of which does not exceed the micro-purchase threshold; · The item is available only from a single source; · The public exigency or emergency for the requirement will not permit a delay resulting from publicizing a competitive solicitation; · The Federal awarding agency or pass-through entity expressly authorizes a noncompetitive procurement in response to a written request from the nonfederal entity; or · After solicitation of a number of sources, competition is determined inadequate PDA’s procurement policy also requires a verification that vendors and sub-recipients are not suspended or debarred by checking the website of the System for Award Management and documentation of such verification maintained by the Finance Office. Condition/Context While PDA has established a procurement policy, it does not fully conform to Federal law and the Uniform Guidance for the following reasons: - Micro purchase threshold is not explicitly defined, although it is mentioned that cost and price analysis shall be made and documented in connection with every procurement action above $5,000. - The policy does not have clear provisions for maintaining detailed procurement records. Such records should include the rationale for the procurement method, the selection of contract type, the contractor selection or rejection process, and the basis for the contract price. - The simplified acquisition threshold is not defined and does not incorporate all relevant elements including sealed bids method. The total misstatement is the entire population amount $1,546,725 as PDA did not maintain sufficient documentation to evidence history of procurement for all procurements. Cause PDA’s procurement policy does not seem to have been reviewed against the Uniform Guidance for compliance. Internal controls over maintaining sufficient records to detail the history of procurement including noncompetitive justification and suspension and debarment verification were found to be insufficient. Effect The absence of a policy that fully conformed to the Uniform Guidance resulted in noncompliance issues such as records sufficient to detail the history of procurement transactions not maintained. Questioned Costs $1,546,725 Repeat Finding Yes Recommendation We recommend PDA implement measures to ensure that its procurement policy reflect applicable state and local laws and regulations conforming to applicable federal statutes and requirement in 2 CFR part 200. Management should ensure procurement transactions are documented in such detail to evidence the method of procurement use and vendor verification for suspension and debarment.

Finding 2024-001 Significant deficiency in internal controls over financial reporting in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP). Criteria Internal controls over financial reporting should be in place to ensure proper reconciliations are being performed to ensure transactions are recorded in accordance with U.S. GAAP. Condition/Context During our audit, we noted that a significant amount of donor restrictions had been met in prior years but not released in those years. Effect/Potential Effect As a result, a prior period adjustment had to be booked to reclass $655,000 from net assets with donor restrictions to net assets without donor restrictions. Cause In the prior year, a year end review of restricted net assets was not performed to assess termed awards or to compare year end restricted net asset balances against expectations based on expenditures to date. Repeat Finding No Recommendation We recommend that PDA implement necessary internal controls to ensure that donor restricted balances are reviewed as part of year end close processes to determine if restrictions have been met and amounts should be released from restriction. Views of Responsible Officials Management agrees with the finding and has provided the corrective action plan following the Single Audit Report.

Finding 2024-002 Significant deficiency in internal controls over financial reporting in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP). Criteria Internal controls over financial reporting should ensure that leases are identified, evaluated, and recorded in accordance with U.S. GAAP, including the recognition of right-of-use assets and lease liabilities, and appropriate classification and disclosure under ASC 842. Condition/Context For the year ended December 31, 2024, the modifications of two leases were incorrectly recorded as if the modifications were present at inception of the leases rather than as of the date of the modification, and one new lease was not recorded as required by ASC 842. Effect/Potential Effect As a result, an adjustment of $41,184 was needed to lease expense, a $40,690 adjustment was needed for lease liabilities, and a $494 adjustment was needed for the right-of-use asset to properly state the financial statements in accordance with US. GAAP. Cause The lease modifications were recorded incorrectly due to a misunderstanding of how the lease accounting software distinguishes between lease edits and lease modifications. Amendments resulting in term extensions are considered triggering events and are recorded as modifications effective on the amendment date. Instead, the original lease terms were edited directly, which prompted the lease accounting software to produce improper calculations. Additionally, a new lease signed during the audit year was initially treated as a short-term lease and not capitalized under ASC 842 based on the expectation that it would be canceled partway through its term. However, no formal amendment was executed to document the early termination. As a result, a right-of-use asset and lease liability were not recorded as required by ASC 842. Repeat Finding No Recommendation We recommend that PDA implement necessary internal controls and review to ensure that lease modifications and new leases are properly recorded in accordance with ASC 842 when executed. Views of Responsible Officials Management agrees with the finding and has provided the corrective action plan following the Single Audit Report.

Finding 2024-003 Material weakness in internal control over compliance with procurement procedures meeting the requirements of 2 CFR Part 200. Federal Agency: Department of Health and Human Services Program Titles: Community Funded Projects Assistance Listing Number: 93.493 Pass-Through Entity: N/A Award Numbers: H79FG001026 and H79FG001037 Award Periods: September 30, 2023 through September 29, 2024 Criteria Internal controls requirements contained in Title 2 U.S. Code of Federal Regulations Uniform Administrative Requirements, Cost Principles and Audit Requirements for Federal Awards (the Uniform Guidance) , Subpart D ‐ Post Federal Award Requirements, Section 200.318 through 200.326 Internal Controls, require that a non‐Federal entity use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. The procurement procedures must include the following: - Using the micro-purchase and small purchase methods only for procurements that meet the applicable criteria under 2 CFR sections 200.320(a) (1) and (2). Under the micro-purchase method, the aggregate dollar amount does not exceed $10,000 ($2,000 in the case of acquisition for construction subject to the Wage Rate Requirements (Davis-Bacon Act)). Small purchase procedures are used for purchases that exceed the micro-purchase amount but do not exceed the simplified acquisition threshold ($250,000). Micro-purchases may be awarded without soliciting competitive quotations if the nonfederal entity considers the price to be reasonable (2 CFR section 200.320(a)). If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources (2 CFR section 200.320(b)). - For acquisitions exceeding the simplified acquisition threshold, using one of the following procurement methods: the sealed bid method if the acquisition meets the criteria in 2 CFR section 200.320(b); the competitive proposals method under the conditions specified in 2 CFR section 200.320((b) (2); or the noncompetitive proposals method (i.e., solicit a proposal from only one source) but only when one or more of the circumstances are met, in accordance with 2 CFR section 200.320(c)). - Using Noncompetitive procurement only if one or more of the following circumstances apply: · The acquisition of property or services, the aggregate dollar amount of which does not exceed the micro-purchase threshold; · The item is available only from a single source; · The public exigency or emergency for the requirement will not permit a delay resulting from publicizing a competitive solicitation; · The Federal awarding agency or pass-through entity expressly authorizes a noncompetitive procurement in response to a written request from the nonfederal entity; or · After solicitation of a number of sources, competition is determined inadequate PDA’s procurement policy also requires a verification that vendors and sub-recipients are not suspended or debarred by checking the website of the System for Award Management and documentation of such verification maintained by the Finance Office. Condition/Context While PDA has established a procurement policy, it does not fully conform to Federal law and the Uniform Guidance for the following reasons: - Micro purchase threshold is not explicitly defined, although it is mentioned that cost and price analysis shall be made and documented in connection with every procurement action above $5,000. - The policy does not have clear provisions for maintaining detailed procurement records. Such records should include the rationale for the procurement method, the selection of contract type, the contractor selection or rejection process, and the basis for the contract price. - The simplified acquisition threshold is not defined and does not incorporate all relevant elements including sealed bids method. The total misstatement is the entire population amount $1,546,725 as PDA did not maintain sufficient documentation to evidence history of procurement for all procurements. Cause PDA’s procurement policy does not seem to have been reviewed against the Uniform Guidance for compliance. Internal controls over maintaining sufficient records to detail the history of procurement including noncompetitive justification and suspension and debarment verification were found to be insufficient. Effect The absence of a policy that fully conformed to the Uniform Guidance resulted in noncompliance issues such as records sufficient to detail the history of procurement transactions not maintained. Questioned Costs $1,546,725 Repeat Finding Yes Recommendation We recommend PDA implement measures to ensure that its procurement policy reflect applicable state and local laws and regulations conforming to applicable federal statutes and requirement in 2 CFR part 200. Management should ensure procurement transactions are documented in such detail to evidence the method of procurement use and vendor verification for suspension and debarment.

Finding 2024-001 Significant deficiency in internal controls over financial reporting in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP). Criteria Internal controls over financial reporting should be in place to ensure proper reconciliations are being performed to ensure transactions are recorded in accordance with U.S. GAAP. Condition/Context During our audit, we noted that a significant amount of donor restrictions had been met in prior years but not released in those years. Effect/Potential Effect As a result, a prior period adjustment had to be booked to reclass $655,000 from net assets with donor restrictions to net assets without donor restrictions. Cause In the prior year, a year end review of restricted net assets was not performed to assess termed awards or to compare year end restricted net asset balances against expectations based on expenditures to date. Repeat Finding No Recommendation We recommend that PDA implement necessary internal controls to ensure that donor restricted balances are reviewed as part of year end close processes to determine if restrictions have been met and amounts should be released from restriction. Views of Responsible Officials Management agrees with the finding and has provided the corrective action plan following the Single Audit Report.

Finding 2024-002 Significant deficiency in internal controls over financial reporting in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP). Criteria Internal controls over financial reporting should ensure that leases are identified, evaluated, and recorded in accordance with U.S. GAAP, including the recognition of right-of-use assets and lease liabilities, and appropriate classification and disclosure under ASC 842. Condition/Context For the year ended December 31, 2024, the modifications of two leases were incorrectly recorded as if the modifications were present at inception of the leases rather than as of the date of the modification, and one new lease was not recorded as required by ASC 842. Effect/Potential Effect As a result, an adjustment of $41,184 was needed to lease expense, a $40,690 adjustment was needed for lease liabilities, and a $494 adjustment was needed for the right-of-use asset to properly state the financial statements in accordance with US. GAAP. Cause The lease modifications were recorded incorrectly due to a misunderstanding of how the lease accounting software distinguishes between lease edits and lease modifications. Amendments resulting in term extensions are considered triggering events and are recorded as modifications effective on the amendment date. Instead, the original lease terms were edited directly, which prompted the lease accounting software to produce improper calculations. Additionally, a new lease signed during the audit year was initially treated as a short-term lease and not capitalized under ASC 842 based on the expectation that it would be canceled partway through its term. However, no formal amendment was executed to document the early termination. As a result, a right-of-use asset and lease liability were not recorded as required by ASC 842. Repeat Finding No Recommendation We recommend that PDA implement necessary internal controls and review to ensure that lease modifications and new leases are properly recorded in accordance with ASC 842 when executed. Views of Responsible Officials Management agrees with the finding and has provided the corrective action plan following the Single Audit Report.

Finding 2024-003 Material weakness in internal control over compliance with procurement procedures meeting the requirements of 2 CFR Part 200. Federal Agency: Department of Health and Human Services Program Titles: Community Funded Projects Assistance Listing Number: 93.493 Pass-Through Entity: N/A Award Numbers: H79FG001026 and H79FG001037 Award Periods: September 30, 2023 through September 29, 2024 Criteria Internal controls requirements contained in Title 2 U.S. Code of Federal Regulations Uniform Administrative Requirements, Cost Principles and Audit Requirements for Federal Awards (the Uniform Guidance) , Subpart D ‐ Post Federal Award Requirements, Section 200.318 through 200.326 Internal Controls, require that a non‐Federal entity use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. The procurement procedures must include the following: - Using the micro-purchase and small purchase methods only for procurements that meet the applicable criteria under 2 CFR sections 200.320(a) (1) and (2). Under the micro-purchase method, the aggregate dollar amount does not exceed $10,000 ($2,000 in the case of acquisition for construction subject to the Wage Rate Requirements (Davis-Bacon Act)). Small purchase procedures are used for purchases that exceed the micro-purchase amount but do not exceed the simplified acquisition threshold ($250,000). Micro-purchases may be awarded without soliciting competitive quotations if the nonfederal entity considers the price to be reasonable (2 CFR section 200.320(a)). If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources (2 CFR section 200.320(b)). - For acquisitions exceeding the simplified acquisition threshold, using one of the following procurement methods: the sealed bid method if the acquisition meets the criteria in 2 CFR section 200.320(b); the competitive proposals method under the conditions specified in 2 CFR section 200.320((b) (2); or the noncompetitive proposals method (i.e., solicit a proposal from only one source) but only when one or more of the circumstances are met, in accordance with 2 CFR section 200.320(c)). - Using Noncompetitive procurement only if one or more of the following circumstances apply: · The acquisition of property or services, the aggregate dollar amount of which does not exceed the micro-purchase threshold; · The item is available only from a single source; · The public exigency or emergency for the requirement will not permit a delay resulting from publicizing a competitive solicitation; · The Federal awarding agency or pass-through entity expressly authorizes a noncompetitive procurement in response to a written request from the nonfederal entity; or · After solicitation of a number of sources, competition is determined inadequate PDA’s procurement policy also requires a verification that vendors and sub-recipients are not suspended or debarred by checking the website of the System for Award Management and documentation of such verification maintained by the Finance Office. Condition/Context While PDA has established a procurement policy, it does not fully conform to Federal law and the Uniform Guidance for the following reasons: - Micro purchase threshold is not explicitly defined, although it is mentioned that cost and price analysis shall be made and documented in connection with every procurement action above $5,000. - The policy does not have clear provisions for maintaining detailed procurement records. Such records should include the rationale for the procurement method, the selection of contract type, the contractor selection or rejection process, and the basis for the contract price. - The simplified acquisition threshold is not defined and does not incorporate all relevant elements including sealed bids method. The total misstatement is the entire population amount $1,546,725 as PDA did not maintain sufficient documentation to evidence history of procurement for all procurements. Cause PDA’s procurement policy does not seem to have been reviewed against the Uniform Guidance for compliance. Internal controls over maintaining sufficient records to detail the history of procurement including noncompetitive justification and suspension and debarment verification were found to be insufficient. Effect The absence of a policy that fully conformed to the Uniform Guidance resulted in noncompliance issues such as records sufficient to detail the history of procurement transactions not maintained. Questioned Costs $1,546,725 Repeat Finding Yes Recommendation We recommend PDA implement measures to ensure that its procurement policy reflect applicable state and local laws and regulations conforming to applicable federal statutes and requirement in 2 CFR part 200. Management should ensure procurement transactions are documented in such detail to evidence the method of procurement use and vendor verification for suspension and debarment.