Audit 410379

U.S. Department of Homeland Security, Federal Emergency Management Agency Passed Through South Dakota Office of Emergency Management BRIC: Building Resilient Infrastructure and Communities #97.047 Award # Not Provided Compliance Requirement – Procurement, Suspension and Debarment Material Weakness over Internal Control over Compliance Criteria: Uniform Guidance and 2 CFR sections 200.318 through 200.326 set forth the procurement standards non-federal entities other than states must follow when operating federal programs and the procurement procedures required depending on the amount of the transaction. It requires a written procurement policy be adopted by the entities receiving federal funding and also requires that contractors and vendors are not suspended or debarred from doing federal work. Condition: The City has not adopted a formal policy related to procurement and does not have a control in place to monitor if the contractor was suspended or debarred from doing federal contract work. Cause: The City uses South Dakota Codified Law for guidance on procurement requirements but does not have a written policy as they were not aware that a written policy was required. Effect: The City will not follow federal requirements for procurement as the federal requirements do not line up with State requirements. Also, the City could enter into a contract with a contractor or vendor who is suspended or debarred. Questioned Costs: None Reported. Context/Sampling: One vendor contract was tested for procurement, suspension and debarment. Repeat Finding from Prior Year(s): No Recommendation: We recommend the City adopt a written Procurement policy which follows the federal guidelines. We also recommend the City include in contract language that contractors are not suspended or debarred. Views of Responsible Officials: Management agreed with the finding.