Audit 401736

Education Innovation and Research (FALN 84.411C) 2025-001: Procurement Policy Condition (Significant Deficiency): The Organization does not have a documented procurement policy governing purchases made with federal grant funds, as required by the Uniform Guidance. Criteria: Uniform Guidance (2 CFR Part 200) requires non-federal entities expending federal funds to establish and maintain written procurement procedures that provide for full and open competition and include specific compliance provisions for the use of federal grant funds. Cause: The Organization was unaware that the Uniform Guidance requires formal, written procurement policies applicable to expenditures of federal grant funds. Effect: As a result, nonpayroll expenditures made with federal funds, including purchases that exceeded $10,000 through 9/30/2025 and $15,000 after 10/1/2025 in the aggregate, may not have been procured in accordance with Uniform Guidance requirements. Although transactions tested were supported by invoices and appeared reasonable in cost, the absence of a formal procurement policy increases the risk of noncompliance with federal procurement standards. Recommendation: We recommend that the Organization adopt and implement a written procurement policy that complies with Uniform Guidance requirements and applies specifically to purchases made with federal grant funds. Management should also ensure that the policy is consistently applied and that staff involved in procurement are trained on its requirements. Views of Responsible Officials and Correction Action: Management’s response and planned corrective actions are presented in the accompanying Corrective Action Plan.