Audit 404289

PRAIRIE-HILLS ELEMENTARY SCHOOL DISTRICT 144 07‐016‐1440‐02 SCHEDULE OF FINDINGS AND QUESTIONED COSTS Year Ending June 30, 2025 SECTION III - FEDERAL AWARD FINDINGS AND QUESTIONED COSTS 1. FINDING NUMBER:14 2025 - 003 2. THIS FINDING IS: X New Repeat from Prior year? Year originally reported? 3. Federal Program Name and Year: Child Nutrition Cluster 4. Project No.: 24-4210-00, 25-4210-00, 25-4299-00, 24-4220-00, 25-4220-00, 25-4240-00 5. AL No.: 10.553, 10.555 6. Passed Through: Illinois State Board of Education 7. Federal Agency: Department of Agriculture 8. Criteria or specific requirement (including statutory, regulatory, or other citation) The District is required to follow the Federal Uniform Guidance (2 CFR §§ 200.320) procurement standards for purchasing goods or services with federal awards. Key requirements include documented procedures, full and open competition, cost and price analysis, conflict of interest policies, and adherence to specific purchasing thresholds (micro-purchase, small purchase, sealed bids, competitive proposals, or sole source). 9. Condition15 The District procured $285,867 from a food service vendor (Gordon) and $539,977 from another food service vendor (Sysco Business Services) and did not follow full and open competition guidelines by using a bidding process. Under (2 CFR §§ 200.320) payments to vendors in excess of the simplified acquisition threshold ($250,000) are required to be procured through a formal competitive bid process. 10. Questioned Costs16 The District's internal accounting records recorded $1,463,085.99 of expenditures to purchased services, supply and capital outlay accounts. Our sampled procurement population noted that $865,844 of services procurred from 2 vendors were not awarded through a competitive bid process. 11. Context17 The District is to obtain price or rate quotations from an adequate number of qualified vendors as well as use a competitive bidding process. During our audit procedures we were unable to obtain supporting documentation for goods procured from food service vendors during the year. The District has not implemented internal procedures to ensure compliance with procurement requirements as outlined in the Federal Uniform Guidance (2 CFR §§ 200.320). 12. Effect Failure to use federal procurement standards results in noncompliance and exposes the District to potentially overpaying for food service commodities or services, potential misuse or of funds, and reduced transparency and accountability. 13. Cause The District did not implement appropriate procurement policy procedures to ensure compliance with procurement requirements in accordance with the Federal Uniform Guidance (2 CFR §§ 200.320). 14. Recommendation We recommend that the District follow the procedures for the procurement of goods that meet the procurment procedures as defined by the Uniform Guidance (2 CFR §§ 200.320). The District should maintain documentation to show that they complied with these requirements. 15. Management's response18 See corrective action plan