Criteria: In accordance with 2 CFR Part 200, Appendix X1, the Compliance Supplement, the auditor should perform reasonable procedures to identify compliance requirements that could have both a direct and material effect on the federal program selected for testing. Reasonable procedures would include a review of the federal awards for programs selected for testing i.e., major program. Condition: No program contract or grant agreement was provided to identify the terms and conditions or the applicable federal compliance requirements that are applicable to the Republic’s expenditures of $2,110,000 for the Maritime Domain Awareness Radars program for the year ended September 30, 2023. Cause: The Republic lacks effective control over the documentation of program contracts and grant agreements. Effect: The Republic is in potential noncompliance with applicable special tests and provisions requirements. No questioned costs are presented as we are aware that the program expenditures appear necessary and reasonable for the performance of the known project objectives. Identification as a Repeat Finding: This is not a repeat finding. Recommendation: The Republic should provide the program’s contract and grant agreements to demonstrate compliance with requirements, which could have a direct and material effect on the program. The Republic’s management should establish and implement controls over obtaining and retaining federal award documents for all federal awards received by the Republic. Views of Responsible Officials: The Republic’s Corrective Action Plan indicates disagreement with the finding. The Republic’s position is set forth in the accompanying Corrective Action Plan.
Criteria: 1. In accordance with 2 CFR § 200.319(a), all procurement transactions under a Federal award must be conducted in a manner that provides full and open competition. Further, 2 CFR § 200.320(a)(1)(i) requires that, to the extent practicable, micro‑purchases be distributed equitably among qualified suppliers. 2. 2 CFR § 200.214 subjects non‑Federal entities to the non-procurement suspension and debarment regulations in 2 CFR part 180, which restrict awards, subawards, and contracts with parties that are debarred, suspended, or otherwise excluded from Federal awards. Under 2 CFR § 180.300, before entering into a covered transaction with another person or entity at the next lower tier, the non Federal entity must verify that the party is not excluded or disqualified. This verification may be completed by reviewing the SAM.gov Exclusions, obtaining a certification from the entity, or including an appropriate suspension and debarment clause or condition in the contract or agreement. Further, in accordance with 2 CFR § 200.318(i), non‑federal entities must maintain records sufficient to document the history of procurement transactions; and 2 CFR § 200.334 requires retention of all supporting documentation for Federal awards. Together, these regulations require that documentation of the suspension and debarment verification be retained to demonstrate compliance with Federal procurement and suspension and debarment requirements. Condition: 1. The Republic’s procurement regulation § 625(c)(3) permits small purchases under $2,500 after obtaining one written price quotation. However, the policy does not demonstrate full and open competition to ensure that to the extent practicable, small purchases are distributed equitably among qualified suppliers. Of the 131 procurement transactions, 54 were identified as within the threshold established under § 625(c)(3)No. No. of Transactions General Ledger Account Name Amount 1 20 General Supplies $ 16,123 2 18 Fuel & Other Pol Products 9,220 3 7 Advertising 5,480 4 4 All Other Rentals 3,467 5 3 Boat Rentals 4,900 6 1 Medical Supplies 364 7 1 Vehicle Cycle Etc Rentl 540 Total: 54 $ 40,094 2. The Republic represents that vendors are verified in SAM.gov before entering into covered transactions; however, no documentation was retained to demonstrate that the required verification occurred. Documentation such as screenshots, printouts, approval records, or other system‑based evidence showing that the SAM.gov check was performed, was not available in the procurement or vendor files. Of the 57 purchase orders issued during the year ended September 30, 2023, 4 were identified as covered transactions subject to federal suspension and debarment requirements, totaling $1,978,024. No. Purchase Order # Vendor Amount 1 22301491 PATIENT FOCUS ARFICA (PTY) TD. $ 48,349 2 22303764 ARC CONSULTANCY 131,924 3 22305075 GOPHER SPORT 95,036 4 PC2 ROJECT BELAU SUBMARINE CABLE CORPORATION 1,702,715 Total: $ 1,978,024 Auditor verification of the above vendors in SAM.gov did not identify any as suspended or debarred. However, the absence of documentation prevents the Republic from demonstrating compliance with Federal suspension and debarment requirements. Cause: The Republic’s procurement policy does not ensure full and open competition for small purchases due to lack of required procedures to equitably distribute small purchases among qualified suppliers. Additionally, the Republic’s procurement procedures do not require the retention of documentation evidencing that suspension and debarment checks were performed. Effect: The Republic is not in compliance with Federal procurement, suspension and debarment requirements. Without federally compliant procedures and supporting documentation, the extent of questioned costs cannot be determined, resulting in an undeterminable question cost. Identification as a Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the Republic update its procurement policies and procedures to include specific guidance to ensure full and open competition to equitably distribute small purchases among available qualified suppliers. Management should ensure that documentation supporting the basis for supplier selection is consistently maintained in procurement files. Additionally, we recommend that the Republic strengthen its procurement and vendor‑approval procedures to require retention of evidence demonstrating that suspension and debarment verification was performed for each covered transaction. Acceptable documentation may include date‑stamped screenshots of the SAM.gov search, system‑generated verification logs, or signed certifications. Documentation should be consistently retained in the procurement or vendor file to support compliance with Federal requirements. Views of Responsible Officials: The Republic’s Corrective Action Plan does not indicate disagreement and provides planned corrective action.
Criteria: 1. In accordance with 2 CFR § 200.319(a), all procurement transactions under a Federal award must be conducted in a manner that provides full and open competition. Further, 2 CFR § 200.320(a)(1)(i) requires that, to the extent practicable, micro‑purchases be distributed equitably among qualified suppliers. 2. 2 CFR § 200.214 subjects non‑Federal entities to the non-procurement suspension and debarment regulations in 2 CFR part 180, which restrict awards, subawards, and contracts with parties that are debarred, suspended, or otherwise excluded from Federal awards. Under 2 CFR § 180.300, before entering into a covered transaction with another person or entity at the next lower tier, the non Federal entity must verify that the party is not excluded or disqualified. This verification may be completed by reviewing the SAM.gov Exclusions, obtaining a certification from the entity, or including an appropriate suspension and debarment clause or condition in the contract or agreement. Further, in accordance with 2 CFR § 200.318(i), non‑federal entities must maintain records sufficient to document the history of procurement transactions, and 2 CFR § 200.334 requires retention of all supporting documentation for Federal awards. Together, these regulations require that documentation of the suspension and debarment verification be retained to demonstrate compliance with Federal procurement and suspension and debarment requirements. Condition: 1. The Republic’s procurement regulation § 625(c)(3) permits purchases under $2,500 after obtaining one written price quotation. However, the policy does not demonstrate full and open competition to ensure that to the extent practicable, small purchases are distributed equitably among qualified suppliers. Of the 143 procurement transactions, 46 were identified as within the threshold established under § 625(c)(3). No. No. of transactions GL Account Name Amount 1 19 Machinery & Equip Repair $ 6,103 2 24 General Supplies 17,106 3 1 Professional 425 4 1 Advertising 500 5 1 Conference 504 Total: 46 $ 24,638 2. The Republic represents that vendors are verified in SAM.gov before entering into covered transactions; however, no documentation was retained to demonstrate that the required verification occurred. Documentation such as screenshots, printouts, approval records, or other system‑based evidence showing that the SAM.gov check was performed was not available in the procurement or vendor files. Of the 38 purchase orders issued during the year ended September 30, 2023, 2 were identified as covered transactions subject to federal suspension and debarment requirements, totaling $92,149. No. Purchase Order # Vendor Amount 1 22305991 EDHANNAH EDUCATION CONSULTING SERVICES $ 21,000 2 22300871 GUAM CEDDERS 71,149 Total: $ 92,149 Auditor verification of the above vendors in SAM.gov did not identify any as suspended or debarred. However, the absence of documentation prevents the Republic from demonstrating compliance with Federal suspension and debarment requirements. Cause: The Republic’s procurement policy does not ensure full and open competition for small purchases due to lack of required procedures to equitably distribute micro‑purchases among qualified suppliers. Additionally, the Republic’s procurement procedures do not require the retention of documentation evidencing that suspension and debarment checks were performed. Effect: The Republic is not in compliance with Federal procurement, suspension and debarment requirements. Without federally compliant procedures and supporting documentation, the extent of questioned costs cannot be determined, resulting in an undeterminable question cost. Identification as a Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the Republic update its procurement policies and procedures to include specific guidance to ensure full and open competition to equitably distribute small purchases among available qualified suppliers. Management should ensure that documentation supporting the basis for supplier selection is consistently maintained in procurement files. Additionally, we recommend that the Republic strengthen its procurement and vendor‑approval procedures to require retention of evidence demonstrating that suspension and debarment verification was performed for each covered transaction. Acceptable documentation may include date‑stamped screenshots of the SAM.gov search, system‑generated verification logs, or signed certifications. Documentation should be consistently retained in the procurement or vendor file to support compliance with Federal requirements. Views of Responsible Officials: The Republic’s Corrective Action Plan does not indicate disagreement and provides planned corrective action.
Criteria: In accordance with the 2023 OMB Compliance Supplement, Part 3, Section C: Cash Management, when non-federal entities are funded under the reimbursement method, the supporting expenditures should be incurred prior to the date of the reimbursement request. Condition: During the testing of cash management requirements, we identified that the Republic submitted a duplicate drawdown request to the grantor agency. A drawdown request dated July 31, 2023, was submitted for $1,183,611. A subsequent drawdown request dated August 7, 2023, totaling $1,214,654, included the same expenditure details and supporting documentation used for the original $1,183,611 request. As a result, the July 31 drawdown request amount of $1,183,611 was duplicated within the August 7 drawdown request. No. Subaccount Subaccount Requested Amount Request Date Debit Date Schedule Number 1 21H8FCS41190C6 $ 1,183,611 7/31/2023 8/2/2023 83463 2 21H8FCS41190C6 $ 1,214,654 8/7/2023 8/9/2023 83480 Cause: The duplicate drawdown occurred due to lack of review and monitoring controls in preparing drawdown requests. Effect: The Republic received federal funds in excess of the allowable reimbursement and is not in compliance with applicable cash management requirements. The reportable questioned cost is the duplicated portion of the August 7 drawdown request, which amounted to $1,183,611. Identification as a Repeat Finding: This is not a repeat finding. Recommendation: The Republic should strengthen the effectiveness of its existing reconciliation and review procedures to ensure duplicate drawdown requests are avoided. The Republic should require a check of prior drawdowns before submitting new requests and maintain a clear log to prevent re‑requesting the same expenditures. Views of Responsible Officials: The Republic’s Corrective Action Plan does not indicate disagreement and provides planned corrective action.
Criteria: 1. In accordance with 2 CFR § 200.319(a), all procurement transactions under a Federal award must be conducted in a manner that provides full and open competition. Further, 2 CFR § 200.320(a)(1)(i) requires that, to the extent practicable, micro‑purchases be distributed equitably among qualified suppliers. 2. 2 CFR § 200.214 subjects non‑Federal entities to the non-procurement suspension and debarment regulations in 2 CFR part 180, which restrict awards, subawards, and contracts with parties that are debarred, suspended, or otherwise excluded from Federal awards. Under 2 CFR § 180.300, before entering into a covered transaction with another person or entity at the next lower tier, the non Federal entity must verify that the party is not excluded or disqualified. This verification may be completed by reviewing the SAM.gov Exclusions, obtaining a certification from the entity, or including an appropriate suspension and debarment clause or condition in the contract or agreement. Further, in accordance with 2 CFR § 200.318(i), non‑federal entities must maintain records sufficient to document the history of procurement transactions, and 2 CFR § 200.334 requires retention of all supporting documentation for Federal awards. Together, these regulations require that documentation of the suspension and debarment verification be retained to demonstrate compliance with Federal procurement and suspension and debarment requirements. Condition: 1. The Republic’s procurement regulation § 625(c)(3) permits purchases under $2,500 after obtaining one written price quotation. However, the policy does not demonstrate full and open competition to ensure that small purchases are distributed equitably among qualified suppliers. Of the 583 procurement transactions, 140 were identified as within the threshold established under § 625(c)(3). No. No. of Transactions General Ledger Account Name Amount 1 7 Boat Rentals $ 9,400 2 64 General Supplies 60,349 3 7 Advertising 1,045 4 6 Conference 11,800 5 1 All Other Purchased Serv 1,999 6 39 Vehicle Cycle Repair 7,987 7 12 Building/Space Rentals 5,830 8 4 Machinery & Equip Repair 837 Total: 140 $ 99,247 2. The Republic represents that vendors are verified in SAM.gov before entering into covered transactions; however, no documentation was retained to demonstrate that the required verification occurred. Documentation such as screenshots, printouts, approval records, or other system‑based evidence showing that the SAM.gov check was performed was not available in the procurement or vendor files. Of the 185 purchase orders issued during the year ended September 30, 2023, 19 were identified as covered transactions subject to federal suspension and debarment requirements, totaling $2,101,228, of which 12 totaling $1,919,175 were selected for testing. No. Purchase Order # Vendor Amount 1 22300843 MEDPHARM $ 93,032 2 22301907 PACIFIC SOURCE INC. LTD. 490,573 3 22301908 PACIFIC SOURCE INC. LTD. 512,382 4 22301909 PACIFIC SOURCE INC. LTD. 463,320 5 22302788 MEDPHARM 111,550 6 22300845 MD WHOLESALE 55,160 7 22301465 MD WHOLESALE 11,952 8 22302557 MD WHOLESALE 29,607 9 22302790 MEDPHARM 80,946 10 22303546 G&N CLEANING EXPRESS 16,560 11 22306254 ARC HEALTH 37,125 12 22307066 MD WHOLESALE 16,968 Total: $ 1,919,175 Auditor verification of the above vendors in SAM.gov did not identify any as suspended or debarred. However, the absence of documentation prevents the Republic from demonstrating compliance with Federal suspension and debarment requirements. Cause: The Republic’s procurement policy does not ensure full and open competition for small purchases and does not include procedures to equitably distribute micro‑purchases among qualified suppliers. Additionally, the Republic’s procurement and vendor compliance procedures do not require the retention of documentation evidencing that suspension and debarment checks were performed. Effect: The Republic is not in compliance with Federal procurement, suspension and debarment requirements. Without federally compliant procedures and supporting documentation, the extent of questioned costs cannot be determined, resulting in an undeterminable question cost. Identification as a Repeat Finding: Finding 2022-009 Recommendation: We recommend that the Republic update its procurement policies and procedures to include specific guidance to ensure full and open competition and to equitably distribute micro‑purchases among qualified suppliers. Management should ensure that documentation supporting the basis for supplier selection is consistently maintained in procurement files. Additionally, we recommend that the Republic strengthen its procurement and vendor‑approval procedures to require retention of evidence demonstrating that suspension and debarment verification was performed for each covered transaction. Acceptable documentation may include date‑stamped screenshots of the SAM.gov search, system‑generated verification logs, or signed certifications. Documentation should be consistently retained in the procurement or vendor file to support compliance with Federal requirements. Views of Responsible Officials: The Republic’s Corrective Action Plan does not indicate disagreement and provides planned corrective action.
Criteria: Per the 2023 OMB Compliance Supplement, Part 4, Agency Program for ALN 93.224, Section III-N: Special Tests and Provisions – Sliding Fee Discounts, health centers must prepare and apply a sliding fee discount schedule (SFDS) so that the amounts owed for health center services by eligible patients are adjusted (discounted) based on the patient’s ability to pay as follows: a. Sliding fee discounts are applied to fees for health center services provided to all individuals and families with annual incomes at or below 200 percent of the Federal Poverty Guidelines (FPG). b. A full discount is applied to fees for health center services provided to individuals and families with annual incomes at or below 100 percent of the FPG, or the health center applies only a nominal charge. c. Fees for health center services are discounted based on gradations in family size and income for individuals and families with incomes above 100 and at or below 200 percent of the FPG. d. No sliding fee discount is applied to fees for health center services provided to individuals and families with annual incomes above 200 percent of the FPG. Conditions: a. The sliding fee discount schedule used by the Republic is the Ministry of Health and Human Service’s Sliding Fee Scale, which is not in accordance with Federal requirements, and has not been updated since January 2006 as shown below. The discounts were applied and determined based on whether the patient is a resident or a nonresident, tourist or non-tourist, with insurance or none, senior citizen, and behavioral health patient. Family Size Ministry of Health and Human Services Sliding Fee Schedule 2023 Federal Poverty Guidelines Percentage of Maximum Charge based on Family Income & Size 20% 30% 40% 50% 60% 70% 100% 200% 1 0-5,700 5,701-10,050 10,051-12,600 12,601-14,100 14,101-17,500 >17,500 $14,580 $29,160 2 0-6,600 6,601-13,500 13,501-16,300 16,301-19,000 19,001-21,800 >21,800 19,720 39,440 3 0-7,400 7,401-17,000 17,001-20,500 20,501-23,900 23,901-27,500 >27,500 24,860 49,720 4 0-8,500 8,501-20,600 20,601-24,800 24,801-28,900 28,901-32,500 >32,500 30,000 60,000 5 0-9,700 9,701-24,200 24,201-29,000 29,001-33,800 33,801-38,700 >38,700 35,140 70,280 6 0-10,700 10,701-27,700 27,701-33,200 33,201-37,500 37,501-43,000 >43,000 40,280 80,560 7 0-11,500 11,501-31,200 31,201-37,400 37,401-43,700 43,701-46,000 >46,000 45,420 90,840 8 0-12,600 12,601-34,700 34,701-41,600 41,601-48,600 48,601-55,600 >55,600 50,560 101,120Family Size Ministry of Health Sliding Fee Schedule 2023 Federal Poverty Guidelines Percentage of Maximum Charge based on Family Income & Size 20% 30% 40% 50% 60% 70% 100% 200% 9 0-14,800 14,801-38,300 38,301-45,900 45,901-53,600 53,601-65,000 >65,000 55,700 111,400 10 0-16,600 16,601-41,800 41,801-50,200 50,201-58,500 58,501-70,000 >70,000 60,840 121,680 11 0-18,900 18,901-45,300 45,301-54,400 54,401-63,400 63,401-75,000 >75,000 65,980 131,960 12 0-23,500 23,501-48,800 48,801-58,600 58,601-68,400 68,401-85,000 >85,000 71,120 142,240 b. For 53 (or 88%) of the 60 invoices tested, $2,123 out of $2,602,954 in total billed amount, patients were not properly billed in accordance with the FPG. A full discount was not applied to fees for health center services provided to individuals and families with annual incomes at or below 100% of the FPG, or a nominal charge. No. Encounter No. Invoice Number Payor Family Size Payor Income Billed Amount Audit Calculation Overbilled 1 787277 764957 1 $ – $ 64 $ 39 $ 25 2 787819 765457 4 – 18 15 3 3 789092 766766 4 – 11 6 5 4 848190 824175 4 12,571 101 89 12 5 793230 770873 3 – 8 6 2 6 796501 774039 1 – 6 6 - 7 797128 774688 4 27,000 21 18 3 8 797721 775240 1 – 57 45 12 9 797818 775349 1 – 103 39 64 10 801261 778707 1 – 9 – 9 11 802290 779671 1 5,426 71 34 37 12 804927 782163 6 18,200 21 - 21 13 806898 784035 1 644 19 10 9 14 807608 784780 2 – 31 – 31 15 813192 790462 6 118 46 – 46 16 814856 791804 1 – 21 12 9 17 815213 792247 4 – 131 – 131 18 815876 792751 2 – 7 6 1 19 818029 794944 2 – 36 34 2 20 818263 795048 1 – 15 – 15 21 820650 797464 1 – 8 – 8 22 820731 797364 1 – 22 5 17 23 821582 798229 1 – 79 10 69 24 822114 798690 1 4,020 22 18 4 25 822216 798815 1 – 136 – 136 26 824758 801180 2 – 41 39 2 No. Encounter No. Invoice Number Payor Family Size Payor Income Bill Charge Audit Calculation Overbilled 27 827135 803468 4 $ 27,000 $ 5 $ – 5 28 808787 786091 3 18,162 121 29 92 29 834360 810455 1 – 68 6 62 30 840094 816261 1 – 55 – 55 31 840363 816597 2 10,654 39 5 34 32 842882 819135 1 – 112 10 102 33 849755 837941 3 252 52 35 17 34 851139 826909 1 14,344 31 5 26 35 856826 832215 3 6,311 19 5 14 36 858240 833919 7 – 18 11 7 37 861380 836621 2 14,657 28 11 17 38 861518 836728 9 – 182 11 171 39 863886 839511 3 – 8 – 8 40 845667 821845 5 16,894 13 – 13 41 829948 806271 2 – 4 – 4 42 794661 772305 2 6,000 5 – 5 43 804242 781544 1 1,974 33 29 4 44 805480 782731 1 – 31 29 2 45 808859 785946 1 – 11 10 1 46 818784 795565 1 – 36 20 16 47 826380 802729 1 11,085 12 5 7 48 850512 826525 2 – 12 – 12 49 851026 826812 1 – 1 – 1 50 791924 769826 2 – 3 – 3 51 857073 833490 5 – 8 – 8 52 857388 832805 3 252 53 44 9 53 859027 834391 2 8,074 61 12 49 Subtotal: $2,125 $708 $1,417 c. For 1 (or 1%) of 60 invoices tested, $13 of $2,602,954 in total billed amount, patients were not properly billed based on the FPG. The fees for health center services were not properly discounted based on gradations in family size and income for this individual with income above 100 and at or below 200% of the FPG. Encounter No. Invoice Number Payor Family Size Payor Income Bill Charge Audit Calculation Overbilled 852731 828622 1 $14,991 $13 $10 $3 d. For 2 (or 3%) of 60 invoices tested, $285 of $2,602,954 in total billed amount, patients were not properly billed based on the FPG. The sliding fee discount was applied to fees for health center services provided to this with annual income above 200% of the FPG. No. Encounter No. Invoice Number Payor Family Size Payor Income Bill Charge Audit Calculation (Underbilled) 1 850308 826165 1 $ 37,920 $ 210 $ 244 $ (34) 2 859829 835191 1 $ 46,675 75 107 (32) Grand Total: $ 285 $ 351 $ (66) Cause: Republic of Palau Public Law (RPPL) 7-13 Section 19, which amends RPPL 5-7, requires Palauan citizens and their spouses to be charged hospital fees at a subsidized rate compared to non-Palauans. Accordingly, the Ministry of Health and Human Services implemented its sliding fee schedule policy in 2006 in accordance with RPPL 7-13. The community health centers program adopted its fee schedule policy based on income and family size. However, this policy cannot be implemented without the support of the Olbiil era Kelulau (National Congress). Effect: The Republic is in noncompliance with applicable special tests and provisions requirements for sliding fee discounts. Reportable questioned cost is $1,354. Identification as a Repeat Finding: Finding 2022-010 Recommendation: We recommend that the Republic implement policies related to the sliding fee discount based on family income and size, in accordance with the aforementioned criteria. Views of Responsible Officials: The Republic’s Corrective Action Plan does not indicate disagreement and provides planned corrective action.
Criteria: 1. In accordance with 2 CFR § 200.319(a), all procurement transactions under a Federal award must be conducted in a manner that provides full and open competition. Further, 2 CFR § 200.320(a)(1)(i) requires that, to the extent practicable, micro‑purchases be distributed equitably among qualified suppliers. 2. 2 CFR § 200.214 subjects non‑Federal entities to the non-procurement suspension and debarment regulations in 2 CFR part 180, which restrict awards, subawards, and contracts with parties that are debarred, suspended, or otherwise excluded from Federal awards. Under 2 CFR § 180.300, before entering into a covered transaction with another person or entity at the next lower tier, the non Federal entity must verify that the party is not excluded or disqualified. This verification may be completed by reviewing the SAM.gov Exclusions, obtaining a certification from the entity, or including an appropriate suspension and debarment clause or condition in the contract or agreement. Further, in accordance with 2 CFR § 200.318(i), non‑federal entities must maintain records sufficient to document the history of procurement transactions, and 2 CFR § 200.334 requires retention of all supporting documentation for Federal awards. Together, these regulations require that documentation of the suspension and debarment verification be retained to demonstrate compliance with Federal procurement and suspension and debarment requirements. Condition: 1. The Republic’s procurement regulation § 625(c)(3) permits small purchases under $2,500 after obtaining one written price quotation. However, the policy does not demonstrate full and open competition to ensure that micro‑purchases are distributed equitably among qualified suppliers. Of the 224 procurement transactions, 72 were identified as within the threshold established under § 625(c)(3). Condition, continued: No. No. of transactions General Ledger Account Name Amount 1 18 General Supplies $ 19,541 2 1 All Other Rentals 240 3 13 Freight 6,894 4 3 Boat Rentals 3,000 5 3 All Other Purchased Serv 1,635 6 3 Conference 6,463 7 5 Vehicle Cycle Repair 628 8 11 Advertising 4,309 9 1 Dues & Fees 700 10 3 Machinery & Equip Repair 899 11 11 Fuel & Other Pol Products 5,865 Total: 72 $ 50,174 2. The Republic represents that vendors are verified in SAM.gov before entering into covered transactions; however, no documentation was retained to demonstrate that the required verification occurred. Documentation such as screenshots, printouts, approval records, or other system‑based evidence showing that the SAM.gov check was performed was not available in the procurement or vendor files. Of the 70 purchase orders issued during the year ended September 30, 2023, 7 were identified as covered transactions subject to federal suspension and debarment requirements totaling $229,639. No. Purchase Order # Vendor Amount 1 22300343 TLAU T. RIDPATH $ 32,500 2 22301468 MD WHOLESALE 5,371 3 22302270 UNIVERSITY OF HAWAII - OFFICE OF RESEARCH SERVICES 59,738 4 22304018 JMI-EDISON 93,300 5 22304084 SOCIAL SECURITY ADMINISTRATION 7,500 6 22306331 BELAU MEDICAL CLINIC 21,870 7 22307680 DIAGNOSTIC LABORATORY SERVICES, INC 9,360 Total: $ 229,639 Condition, continued: Auditor verification of the above vendors in SAM.gov not identify any as suspended or debarred. However, the absence of documentation prevents the Republic from demonstrating compliance with Federal suspension and debarment requirements. Cause: The Republic’s procurement policy does not ensure full and open competition for small purchases due to lack of procedures to equitably distribute small purchases among qualified suppliers. Additionally, the Republic’s procurement and vendor compliance procedures do not require the retention of documentation evidencing that suspension and debarment checks were performed. Effect: The Republic is not in compliance with Federal procurement, suspension and debarment requirements. Without federally compliant procedures and supporting documentation, the extent of questioned costs cannot be determined, resulting in an undeterminable question cost. Identification as a Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the Republic update its procurement policies and procedures to include specific guidance to ensure full and open competition and to equitably distribute small purchases among available qualified suppliers. Management should ensure that documentation supporting the basis for supplier selection is consistently maintained in procurement files. Additionally, we recommend that the Republic strengthen its procurement and vendor‑approval procedures to require retention of evidence demonstrating that suspension and debarment verification was performed for each covered transaction. Acceptable documentation may include date‑stamped screenshots of the SAM.gov search, system‑generated verification logs, or signed certifications. Documentation should be consistently retained in the procurement or vendor file to support compliance with Federal requirements. Views of Responsible Officials: The Republic’s Corrective Action Plan does not indicate disagreement and provides planned corrective action.