Audit 388497

Procurement Documentation - Federal Agency: Department of Health and Human Services - Health Resources and Services Administration. Award Name: Community Project - HACCC Renovations. Program Year: 2025. Assistance Listing Number: 93.493. Criteria: Purchases above the Simplified Acquisition Threshold must follow formal procurement methods. For any of these methods, the recipient or subrecipient must maintain and use documented procurement procedures, consistent with the standards. Condition: For certain equipment purchases, the Company did not follow formal procurement methods. For any of these methods, the recipient or subrecipient must maintain and use documented procurement procedures, consistent with the standards. While various estimates were obtained for the budget process required for the grant, there were no formal quotes or bids obtained. Context: For one purchase in the amount of $271,597, there was no documentation to support price comparisons and estimates used in the budget process. Cause: Management transition and uncertainty regarding the application of the standard for this particular grant. Effect: Documentation was not maintained to support compliance with the standards. Questioned Costs: $271,597. Recommendation: Documentation should be maintained to support all purchases in accordance with procurement policies. Views of Responsible Parties: We concur with the finding. The absence of required procurement documentation resulted primarily from turnover within key leadership positions during the period of the purchase. The leaders responsible for procurement review, approval, and record retention transitioned out of their roles, which led to gaps in procedural continuity and oversight. As a result, standard documentation that would typically accompany procurement—such as quotes, and price comparisons—was not properly retained.