FA 2022-003 Strengthen Controls over Procurement Compliance Requirement: Procurement and Suspension and Debarment Internal Control Impact: Significant Deficiency Compliance Impact: Nonmaterial Noncompliance Federal Awarding Agency: U.S. Department of Education Pass-Through Entity: Georgia Department of Education AL Numbers and Titles: 84.027 – Special Education Grants to States 84.173 – Special Education Preschool Grants Federal Award Numbers: HO27A200073(Year: 2021), HO27A210073 (Year: 2022), HO27X210073 (Year: 2022) Questioned Costs: None Identified Description: A review of expenditures charged to the Special Education Cluster revealed that the School District’s internal control procedures were not operating appropriately to ensure that the School District’s procurement procedures were followed. Background Information: The Special Education Cluster (SEC), which is comprised of the Special Education Grants to States (IDEA, Part B) and Special Education Preschool Grants (IDEA Preschool) programs, was authorized under the Individuals with Disabilities Education Act (IDEA). Special Education Cluster funding is available to ensure that all children with disabilities have available to them a free appropriate public education that emphasizes special education and related services designed to meet their unique needs and prepares them for further education, employment, and independent living; ensure that the rights of children with disabilities and their parents are protected; assist states, localities, educational service agencies, and federal agencies to provide for the education of all children with disabilities; and assess and ensure the effectiveness of efforts to educate children with disabilities. SEC funding was granted to the Georgia Department of Education (GaDOE) by the U.S. Department of Education (ED). GaDOE is responsible for distributing funds to LEAs and overseeing the expenditure of funds by LEAs. SEC funds totaling $1,053,381.74 were expended and reported on the Burke County Board of Education’s Schedule of Expenditures of Federal Awards (SEFA) for fiscal year 2022. Criteria: As a recipient of federal awards, the School District is required to establish and maintain effective internal control over federal awards that provides reasonable assurance of managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards pursuant to Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), Section 200.303 – Internal Controls. Additionally, provisions included in the Uniform Guidance, Section 200.318 – General Procurement Standards state in part that “(a) the non-Federal entity must use its own documented procurement procedures which reflect applicable State, local, and tribal laws and regulations and… (b) non-Federal entities must maintain oversight to ensure that contractors perform in accordance with the terms, conditions, and specifications of their contracts or purchase orders.” In addition, provisions included in the Uniform Guidance, Section 200.320 – Methods of Procurement to Be Followed provide guidance for procurement through small purchase procedures and state “If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources.” Furthermore, Title 2 CFR Section 180.300 states in part that the non-federal entity must “verify that the entity with whom you intend to do business is not excluded or disqualified. You can do this by: (a) Checking System for Awards Management (SAM) exclusions; or (b) Collecting a certification from the entity; or (c) Adding a clause or condition to the covered transaction with the entity.” Condition: A sample of 32 procurement transactions was randomly selected for testing using a non-statistical sampling approach. These transactions were reviewed to determine if appropriate internal controls were implemented and applicable compliance requirements were met. The following deficiency was noted: • The School District could not provide evidence that an adequate number of rate or price quotations were obtained from qualified sources for 2 small purchase expenditures reviewed. Cause: The School District did not obtain price or rate quotations for expenditures from an adequate number of qualified sources because they considered themselves to be in a remote location and assumed there would be no competition. Effect or Potential Effect: The School District is not in compliance with the Uniform Guidance and Georgia Department of Education guidance. Failure to appropriately implement procedures to address procurement compliance requirements exposes the School District to unnecessary risk of error and misuse of federal funds and could result in the expenditure of federal funds with unqualified vendors. In addition, this deficiency could lead to the return of grant funds associated with unallowable expenditures. Recommendation: The School District should evaluate and improve internal control procedures to ensure that required procurement methods are properly identified and followed and required procurement documentation is properly identified, safeguarded, and retained. In addition, management should develop a monitoring process to ensure that these procedures are operating appropriately. Views of Responsible Officials: We concur with this finding.
FA 2022-003 Strengthen Controls over Procurement Compliance Requirement: Procurement and Suspension and Debarment Internal Control Impact: Significant Deficiency Compliance Impact: Nonmaterial Noncompliance Federal Awarding Agency: U.S. Department of Education Pass-Through Entity: Georgia Department of Education AL Numbers and Titles: 84.027 – Special Education Grants to States 84.173 – Special Education Preschool Grants Federal Award Numbers: HO27A200073(Year: 2021), HO27A210073 (Year: 2022), HO27X210073 (Year: 2022) Questioned Costs: None Identified Description: A review of expenditures charged to the Special Education Cluster revealed that the School District’s internal control procedures were not operating appropriately to ensure that the School District’s procurement procedures were followed. Background Information: The Special Education Cluster (SEC), which is comprised of the Special Education Grants to States (IDEA, Part B) and Special Education Preschool Grants (IDEA Preschool) programs, was authorized under the Individuals with Disabilities Education Act (IDEA). Special Education Cluster funding is available to ensure that all children with disabilities have available to them a free appropriate public education that emphasizes special education and related services designed to meet their unique needs and prepares them for further education, employment, and independent living; ensure that the rights of children with disabilities and their parents are protected; assist states, localities, educational service agencies, and federal agencies to provide for the education of all children with disabilities; and assess and ensure the effectiveness of efforts to educate children with disabilities. SEC funding was granted to the Georgia Department of Education (GaDOE) by the U.S. Department of Education (ED). GaDOE is responsible for distributing funds to LEAs and overseeing the expenditure of funds by LEAs. SEC funds totaling $1,053,381.74 were expended and reported on the Burke County Board of Education’s Schedule of Expenditures of Federal Awards (SEFA) for fiscal year 2022. Criteria: As a recipient of federal awards, the School District is required to establish and maintain effective internal control over federal awards that provides reasonable assurance of managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards pursuant to Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), Section 200.303 – Internal Controls. Additionally, provisions included in the Uniform Guidance, Section 200.318 – General Procurement Standards state in part that “(a) the non-Federal entity must use its own documented procurement procedures which reflect applicable State, local, and tribal laws and regulations and… (b) non-Federal entities must maintain oversight to ensure that contractors perform in accordance with the terms, conditions, and specifications of their contracts or purchase orders.” In addition, provisions included in the Uniform Guidance, Section 200.320 – Methods of Procurement to Be Followed provide guidance for procurement through small purchase procedures and state “If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources.” Furthermore, Title 2 CFR Section 180.300 states in part that the non-federal entity must “verify that the entity with whom you intend to do business is not excluded or disqualified. You can do this by: (a) Checking System for Awards Management (SAM) exclusions; or (b) Collecting a certification from the entity; or (c) Adding a clause or condition to the covered transaction with the entity.” Condition: A sample of 32 procurement transactions was randomly selected for testing using a non-statistical sampling approach. These transactions were reviewed to determine if appropriate internal controls were implemented and applicable compliance requirements were met. The following deficiency was noted: • The School District could not provide evidence that an adequate number of rate or price quotations were obtained from qualified sources for 2 small purchase expenditures reviewed. Cause: The School District did not obtain price or rate quotations for expenditures from an adequate number of qualified sources because they considered themselves to be in a remote location and assumed there would be no competition. Effect or Potential Effect: The School District is not in compliance with the Uniform Guidance and Georgia Department of Education guidance. Failure to appropriately implement procedures to address procurement compliance requirements exposes the School District to unnecessary risk of error and misuse of federal funds and could result in the expenditure of federal funds with unqualified vendors. In addition, this deficiency could lead to the return of grant funds associated with unallowable expenditures. Recommendation: The School District should evaluate and improve internal control procedures to ensure that required procurement methods are properly identified and followed and required procurement documentation is properly identified, safeguarded, and retained. In addition, management should develop a monitoring process to ensure that these procedures are operating appropriately. Views of Responsible Officials: We concur with this finding.
FA 2022-003 Strengthen Controls over Procurement Compliance Requirement: Procurement and Suspension and Debarment Internal Control Impact: Significant Deficiency Compliance Impact: Nonmaterial Noncompliance Federal Awarding Agency: U.S. Department of Education Pass-Through Entity: Georgia Department of Education AL Numbers and Titles: 84.027 – Special Education Grants to States 84.173 – Special Education Preschool Grants Federal Award Numbers: HO27A200073(Year: 2021), HO27A210073 (Year: 2022), HO27X210073 (Year: 2022) Questioned Costs: None Identified Description: A review of expenditures charged to the Special Education Cluster revealed that the School District’s internal control procedures were not operating appropriately to ensure that the School District’s procurement procedures were followed. Background Information: The Special Education Cluster (SEC), which is comprised of the Special Education Grants to States (IDEA, Part B) and Special Education Preschool Grants (IDEA Preschool) programs, was authorized under the Individuals with Disabilities Education Act (IDEA). Special Education Cluster funding is available to ensure that all children with disabilities have available to them a free appropriate public education that emphasizes special education and related services designed to meet their unique needs and prepares them for further education, employment, and independent living; ensure that the rights of children with disabilities and their parents are protected; assist states, localities, educational service agencies, and federal agencies to provide for the education of all children with disabilities; and assess and ensure the effectiveness of efforts to educate children with disabilities. SEC funding was granted to the Georgia Department of Education (GaDOE) by the U.S. Department of Education (ED). GaDOE is responsible for distributing funds to LEAs and overseeing the expenditure of funds by LEAs. SEC funds totaling $1,053,381.74 were expended and reported on the Burke County Board of Education’s Schedule of Expenditures of Federal Awards (SEFA) for fiscal year 2022. Criteria: As a recipient of federal awards, the School District is required to establish and maintain effective internal control over federal awards that provides reasonable assurance of managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards pursuant to Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), Section 200.303 – Internal Controls. Additionally, provisions included in the Uniform Guidance, Section 200.318 – General Procurement Standards state in part that “(a) the non-Federal entity must use its own documented procurement procedures which reflect applicable State, local, and tribal laws and regulations and… (b) non-Federal entities must maintain oversight to ensure that contractors perform in accordance with the terms, conditions, and specifications of their contracts or purchase orders.” In addition, provisions included in the Uniform Guidance, Section 200.320 – Methods of Procurement to Be Followed provide guidance for procurement through small purchase procedures and state “If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources.” Furthermore, Title 2 CFR Section 180.300 states in part that the non-federal entity must “verify that the entity with whom you intend to do business is not excluded or disqualified. You can do this by: (a) Checking System for Awards Management (SAM) exclusions; or (b) Collecting a certification from the entity; or (c) Adding a clause or condition to the covered transaction with the entity.” Condition: A sample of 32 procurement transactions was randomly selected for testing using a non-statistical sampling approach. These transactions were reviewed to determine if appropriate internal controls were implemented and applicable compliance requirements were met. The following deficiency was noted: • The School District could not provide evidence that an adequate number of rate or price quotations were obtained from qualified sources for 2 small purchase expenditures reviewed. Cause: The School District did not obtain price or rate quotations for expenditures from an adequate number of qualified sources because they considered themselves to be in a remote location and assumed there would be no competition. Effect or Potential Effect: The School District is not in compliance with the Uniform Guidance and Georgia Department of Education guidance. Failure to appropriately implement procedures to address procurement compliance requirements exposes the School District to unnecessary risk of error and misuse of federal funds and could result in the expenditure of federal funds with unqualified vendors. In addition, this deficiency could lead to the return of grant funds associated with unallowable expenditures. Recommendation: The School District should evaluate and improve internal control procedures to ensure that required procurement methods are properly identified and followed and required procurement documentation is properly identified, safeguarded, and retained. In addition, management should develop a monitoring process to ensure that these procedures are operating appropriately. Views of Responsible Officials: We concur with this finding.
FA 2022-001 Improve Controls over Expenditures Compliance Requirement: Activities Allowed/Unallowed Allowable Costs/Cost Principles Internal Control Impact: Material Weakness Compliance Impact: Material Noncompliance Federal Awarding Agency: U.S. Department of Education Pass-Through Entity: Georgia Department of Education AL Numbers and Titles: COVID-19 – 84.425D – Elementary and Secondary School Emergency Relief Fund COVID-19 – 84.425U – American Rescue Plan Elementary and Secondary School Emergency Relief Fund COVID-19 – 84.425W – Elementary and Secondary School Emergency Relief Fund Federal Award Number: S4250200012 (Year: 2020), S4250210012 (Year 2021), S425U210012 (Year: 2021), S425W210011 (Year 2021) Questioned Costs: $279,314 Description: The policies and procedures of the School District were insufficient to provide adequate internal controls over expenditures as it relates to the Elementary and Secondary School Emergency Relief Fund program. Background: On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security (CARES) Act was signed into law. The CARES Act was designed to mitigate the economic effects of the COVID-19 pandemic in a variety of ways, including providing additional funding for local educational agencies (LEAs) navigating the impact of the COVID-19 outbreak. Provisions included in Title VIII of the CARES Act created the Education Stabilization Fund to provide financial resources to educational entities to prevent, prepare for, and respond to coronavirus. The CARES Act allocated $30.75 billion, the Coronavirus Response and Relief Supplemental Appropriations Act allocated an additional $81.9 billion, and the American Rescue Plan Act added $165.1 billion in funding to the Education Stabilization Fund. Multiple Education Stabilization Fund subprograms were created and allotted funding through the various COVID-19-related legislation. Of these programs, the Elementary and Secondary School Emergency Relief (ESSER) Fund was created to address the impact that COVID-19 has had, and continues to have, on elementary and secondary schools across the nation. lll FEDERAL AWARD FINDINGS AND QUESTIONED COSTS ESSER funding was granted to the Georgia Department of Education (GaDOE) by the U.S. Department of Education (ED). GaDOE is responsible for distributing funds to LEAs and overseeing the expenditure of funds by LEAs. ESSER funds totaling $3,718,412.45 were expended and reported on the City of Thomasville Board of Education’s Schedule of Expenditures of Federal Awards (SEFA) for fiscal year 2022. Criteria: As a recipient of federal awards, the School District is required to establish and maintain effective internal control over federal awards that provides reasonable assurance of managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards pursuant to Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), Section 200.303 – Internal Controls. Additionally, provisions included in the Uniform Guidance, Section 200.403 – Factors Affecting Allowability of Costs state that “costs must meet the following general criteria in order to be allowable under Federal awards: (a) Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles, (b) Conform to any limitations or exclusions set forth in these principles or in the Federal award as to types or amount of cost items, (c) Be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity… (g) Be adequately documented…” In addition, provisions included in the Uniform Guidance, Section 202.403 – Reasonable Costs state that “a cost is reasonable if, in its nature and amount, it does not exceed that which would be incurred by a prudent person under the circumstances prevailing at the time the decision was made to incur the cost. The question of reasonableness is particularly important when the non-Federal entity is predominantly federally-funded. In determining reasonableness of a given cost, consideration must be given to: (a) Whether the cost is of a type generally recognized as ordinary and necessary for the operation of the non-Federal entity or the proper and efficient performance of the Federal award. (b) The restraints or requirements imposed by such factors as: sound business practices; arm’s-length bargaining; Federal, state, local, tribal, and other laws and regulations; and terms and conditions of the Federal award… (d) Whether the individuals concerned acted with prudence in the circumstances considering their responsibilities to the non-Federal entity, its employees, where applicable its students or membership, the public at large, and the Federal Government. (e) Whether the non-Federal entity significantly deviates from its established practices and policies regarding the incurrence of costs, which may unjustifiably increase the Federal award’s cost.” Furthermore, provisions included in the Uniform Guidance, Section 200.318 – General Procurement Standards state that “the non-Federal entity must have and use documented procurement procedures, consistent with State, local, and tribal laws and regulations… for the acquisition of property or services required under a Federal award or subaward…” Condition: Auditors performed a review of expenditure activity associated with the ESSER program to determine if appropriate internal controls were implemented and applicable compliance requirements were met. This testing revealed that “retention” bonuses were paid to individuals who were not employees of the School District. These individuals were hired to perform specific functions as detailed within the associated contracts and were paid amounts in excess of the stated rate noted within these contracts. Furthermore, the School District does not have the authority or ability to retain these individuals as lll FEDERAL AWARD FINDINGS AND QUESTIONED COSTS they were not employees of the School District and contract provisions requiring the individuals to remain employed by the companies and in the service of the School District for a stated period of time were not reflected within the associated contract. Therefore, expenditures totaling $60,315.00 were not considered to be reasonable and necessary for the performance of the ESSER program and deemed unallowable. Questioned Costs: Known questioned costs of $60,315.00 were identified for expenditures that were not incurred for a necessary and reasonable purpose and did not follow the School District’s policies and procedures. Using the population being sampled, which totaled $329,101.23, we project the likely questioned costs to be approximately $279,314.22. Cause: Per discussion with management, the School District believed that the expenditures were allowable as the expenditures were approved by GaDOE through the Consolidated Application process and approved by the local Board of Education; however, they were not aware that contract amendments should be initiated prior to the expenditure of funds in this manner. Effect: The School District is not in compliance with the Uniform Guidance or GaDOE guidance related to the ESSER program. Failure to ensure that appropriate policies and procedures are followed when expending federal funds may expose the School District to unnecessary financial strain and shortages and GaDOE may require the School District to return funds associated with unallowable expenditures. Recommendation: The School District should review current internal control procedures related to ESSER program expenditures. Where vulnerable, the School District should develop and/or modify its policies and procedures to ensure that expenditures are in line with provisions reflected within the associated contract and/or contract amendments. In addition, the School District should implement a monitoring process to ensure that all expenditures are compliant with the School District’s purchasing policies and procedures. Views of Responsible Officials: We concur with this finding.
FA 2022-001 Improve Controls over Expenditures Compliance Requirement: Activities Allowed/Unallowed Allowable Costs/Cost Principles Internal Control Impact: Material Weakness Compliance Impact: Material Noncompliance Federal Awarding Agency: U.S. Department of Education Pass-Through Entity: Georgia Department of Education AL Numbers and Titles: COVID-19 – 84.425D – Elementary and Secondary School Emergency Relief Fund COVID-19 – 84.425U – American Rescue Plan Elementary and Secondary School Emergency Relief Fund COVID-19 – 84.425W – Elementary and Secondary School Emergency Relief Fund Federal Award Number: S4250200012 (Year: 2020), S4250210012 (Year 2021), S425U210012 (Year: 2021), S425W210011 (Year 2021) Questioned Costs: $279,314 Description: The policies and procedures of the School District were insufficient to provide adequate internal controls over expenditures as it relates to the Elementary and Secondary School Emergency Relief Fund program. Background: On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security (CARES) Act was signed into law. The CARES Act was designed to mitigate the economic effects of the COVID-19 pandemic in a variety of ways, including providing additional funding for local educational agencies (LEAs) navigating the impact of the COVID-19 outbreak. Provisions included in Title VIII of the CARES Act created the Education Stabilization Fund to provide financial resources to educational entities to prevent, prepare for, and respond to coronavirus. The CARES Act allocated $30.75 billion, the Coronavirus Response and Relief Supplemental Appropriations Act allocated an additional $81.9 billion, and the American Rescue Plan Act added $165.1 billion in funding to the Education Stabilization Fund. Multiple Education Stabilization Fund subprograms were created and allotted funding through the various COVID-19-related legislation. Of these programs, the Elementary and Secondary School Emergency Relief (ESSER) Fund was created to address the impact that COVID-19 has had, and continues to have, on elementary and secondary schools across the nation. lll FEDERAL AWARD FINDINGS AND QUESTIONED COSTS ESSER funding was granted to the Georgia Department of Education (GaDOE) by the U.S. Department of Education (ED). GaDOE is responsible for distributing funds to LEAs and overseeing the expenditure of funds by LEAs. ESSER funds totaling $3,718,412.45 were expended and reported on the City of Thomasville Board of Education’s Schedule of Expenditures of Federal Awards (SEFA) for fiscal year 2022. Criteria: As a recipient of federal awards, the School District is required to establish and maintain effective internal control over federal awards that provides reasonable assurance of managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards pursuant to Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), Section 200.303 – Internal Controls. Additionally, provisions included in the Uniform Guidance, Section 200.403 – Factors Affecting Allowability of Costs state that “costs must meet the following general criteria in order to be allowable under Federal awards: (a) Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles, (b) Conform to any limitations or exclusions set forth in these principles or in the Federal award as to types or amount of cost items, (c) Be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity… (g) Be adequately documented…” In addition, provisions included in the Uniform Guidance, Section 202.403 – Reasonable Costs state that “a cost is reasonable if, in its nature and amount, it does not exceed that which would be incurred by a prudent person under the circumstances prevailing at the time the decision was made to incur the cost. The question of reasonableness is particularly important when the non-Federal entity is predominantly federally-funded. In determining reasonableness of a given cost, consideration must be given to: (a) Whether the cost is of a type generally recognized as ordinary and necessary for the operation of the non-Federal entity or the proper and efficient performance of the Federal award. (b) The restraints or requirements imposed by such factors as: sound business practices; arm’s-length bargaining; Federal, state, local, tribal, and other laws and regulations; and terms and conditions of the Federal award… (d) Whether the individuals concerned acted with prudence in the circumstances considering their responsibilities to the non-Federal entity, its employees, where applicable its students or membership, the public at large, and the Federal Government. (e) Whether the non-Federal entity significantly deviates from its established practices and policies regarding the incurrence of costs, which may unjustifiably increase the Federal award’s cost.” Furthermore, provisions included in the Uniform Guidance, Section 200.318 – General Procurement Standards state that “the non-Federal entity must have and use documented procurement procedures, consistent with State, local, and tribal laws and regulations… for the acquisition of property or services required under a Federal award or subaward…” Condition: Auditors performed a review of expenditure activity associated with the ESSER program to determine if appropriate internal controls were implemented and applicable compliance requirements were met. This testing revealed that “retention” bonuses were paid to individuals who were not employees of the School District. These individuals were hired to perform specific functions as detailed within the associated contracts and were paid amounts in excess of the stated rate noted within these contracts. Furthermore, the School District does not have the authority or ability to retain these individuals as lll FEDERAL AWARD FINDINGS AND QUESTIONED COSTS they were not employees of the School District and contract provisions requiring the individuals to remain employed by the companies and in the service of the School District for a stated period of time were not reflected within the associated contract. Therefore, expenditures totaling $60,315.00 were not considered to be reasonable and necessary for the performance of the ESSER program and deemed unallowable. Questioned Costs: Known questioned costs of $60,315.00 were identified for expenditures that were not incurred for a necessary and reasonable purpose and did not follow the School District’s policies and procedures. Using the population being sampled, which totaled $329,101.23, we project the likely questioned costs to be approximately $279,314.22. Cause: Per discussion with management, the School District believed that the expenditures were allowable as the expenditures were approved by GaDOE through the Consolidated Application process and approved by the local Board of Education; however, they were not aware that contract amendments should be initiated prior to the expenditure of funds in this manner. Effect: The School District is not in compliance with the Uniform Guidance or GaDOE guidance related to the ESSER program. Failure to ensure that appropriate policies and procedures are followed when expending federal funds may expose the School District to unnecessary financial strain and shortages and GaDOE may require the School District to return funds associated with unallowable expenditures. Recommendation: The School District should review current internal control procedures related to ESSER program expenditures. Where vulnerable, the School District should develop and/or modify its policies and procedures to ensure that expenditures are in line with provisions reflected within the associated contract and/or contract amendments. In addition, the School District should implement a monitoring process to ensure that all expenditures are compliant with the School District’s purchasing policies and procedures. Views of Responsible Officials: We concur with this finding.
FA 2022-001 Improve Controls over Expenditures Compliance Requirement: Activities Allowed/Unallowed Allowable Costs/Cost Principles Internal Control Impact: Material Weakness Compliance Impact: Material Noncompliance Federal Awarding Agency: U.S. Department of Education Pass-Through Entity: Georgia Department of Education AL Numbers and Titles: COVID-19 – 84.425D – Elementary and Secondary School Emergency Relief Fund COVID-19 – 84.425U – American Rescue Plan Elementary and Secondary School Emergency Relief Fund COVID-19 – 84.425W – Elementary and Secondary School Emergency Relief Fund Federal Award Number: S4250200012 (Year: 2020), S4250210012 (Year 2021), S425U210012 (Year: 2021), S425W210011 (Year 2021) Questioned Costs: $279,314 Description: The policies and procedures of the School District were insufficient to provide adequate internal controls over expenditures as it relates to the Elementary and Secondary School Emergency Relief Fund program. Background: On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security (CARES) Act was signed into law. The CARES Act was designed to mitigate the economic effects of the COVID-19 pandemic in a variety of ways, including providing additional funding for local educational agencies (LEAs) navigating the impact of the COVID-19 outbreak. Provisions included in Title VIII of the CARES Act created the Education Stabilization Fund to provide financial resources to educational entities to prevent, prepare for, and respond to coronavirus. The CARES Act allocated $30.75 billion, the Coronavirus Response and Relief Supplemental Appropriations Act allocated an additional $81.9 billion, and the American Rescue Plan Act added $165.1 billion in funding to the Education Stabilization Fund. Multiple Education Stabilization Fund subprograms were created and allotted funding through the various COVID-19-related legislation. Of these programs, the Elementary and Secondary School Emergency Relief (ESSER) Fund was created to address the impact that COVID-19 has had, and continues to have, on elementary and secondary schools across the nation. lll FEDERAL AWARD FINDINGS AND QUESTIONED COSTS ESSER funding was granted to the Georgia Department of Education (GaDOE) by the U.S. Department of Education (ED). GaDOE is responsible for distributing funds to LEAs and overseeing the expenditure of funds by LEAs. ESSER funds totaling $3,718,412.45 were expended and reported on the City of Thomasville Board of Education’s Schedule of Expenditures of Federal Awards (SEFA) for fiscal year 2022. Criteria: As a recipient of federal awards, the School District is required to establish and maintain effective internal control over federal awards that provides reasonable assurance of managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards pursuant to Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), Section 200.303 – Internal Controls. Additionally, provisions included in the Uniform Guidance, Section 200.403 – Factors Affecting Allowability of Costs state that “costs must meet the following general criteria in order to be allowable under Federal awards: (a) Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles, (b) Conform to any limitations or exclusions set forth in these principles or in the Federal award as to types or amount of cost items, (c) Be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity… (g) Be adequately documented…” In addition, provisions included in the Uniform Guidance, Section 202.403 – Reasonable Costs state that “a cost is reasonable if, in its nature and amount, it does not exceed that which would be incurred by a prudent person under the circumstances prevailing at the time the decision was made to incur the cost. The question of reasonableness is particularly important when the non-Federal entity is predominantly federally-funded. In determining reasonableness of a given cost, consideration must be given to: (a) Whether the cost is of a type generally recognized as ordinary and necessary for the operation of the non-Federal entity or the proper and efficient performance of the Federal award. (b) The restraints or requirements imposed by such factors as: sound business practices; arm’s-length bargaining; Federal, state, local, tribal, and other laws and regulations; and terms and conditions of the Federal award… (d) Whether the individuals concerned acted with prudence in the circumstances considering their responsibilities to the non-Federal entity, its employees, where applicable its students or membership, the public at large, and the Federal Government. (e) Whether the non-Federal entity significantly deviates from its established practices and policies regarding the incurrence of costs, which may unjustifiably increase the Federal award’s cost.” Furthermore, provisions included in the Uniform Guidance, Section 200.318 – General Procurement Standards state that “the non-Federal entity must have and use documented procurement procedures, consistent with State, local, and tribal laws and regulations… for the acquisition of property or services required under a Federal award or subaward…” Condition: Auditors performed a review of expenditure activity associated with the ESSER program to determine if appropriate internal controls were implemented and applicable compliance requirements were met. This testing revealed that “retention” bonuses were paid to individuals who were not employees of the School District. These individuals were hired to perform specific functions as detailed within the associated contracts and were paid amounts in excess of the stated rate noted within these contracts. Furthermore, the School District does not have the authority or ability to retain these individuals as lll FEDERAL AWARD FINDINGS AND QUESTIONED COSTS they were not employees of the School District and contract provisions requiring the individuals to remain employed by the companies and in the service of the School District for a stated period of time were not reflected within the associated contract. Therefore, expenditures totaling $60,315.00 were not considered to be reasonable and necessary for the performance of the ESSER program and deemed unallowable. Questioned Costs: Known questioned costs of $60,315.00 were identified for expenditures that were not incurred for a necessary and reasonable purpose and did not follow the School District’s policies and procedures. Using the population being sampled, which totaled $329,101.23, we project the likely questioned costs to be approximately $279,314.22. Cause: Per discussion with management, the School District believed that the expenditures were allowable as the expenditures were approved by GaDOE through the Consolidated Application process and approved by the local Board of Education; however, they were not aware that contract amendments should be initiated prior to the expenditure of funds in this manner. Effect: The School District is not in compliance with the Uniform Guidance or GaDOE guidance related to the ESSER program. Failure to ensure that appropriate policies and procedures are followed when expending federal funds may expose the School District to unnecessary financial strain and shortages and GaDOE may require the School District to return funds associated with unallowable expenditures. Recommendation: The School District should review current internal control procedures related to ESSER program expenditures. Where vulnerable, the School District should develop and/or modify its policies and procedures to ensure that expenditures are in line with provisions reflected within the associated contract and/or contract amendments. In addition, the School District should implement a monitoring process to ensure that all expenditures are compliant with the School District’s purchasing policies and procedures. Views of Responsible Officials: We concur with this finding.
FA 2022-001 Improve Controls over Expenditures Compliance Requirement: Activities Allowed/Unallowed Allowable Costs/Cost Principles Internal Control Impact: Material Weakness Compliance Impact: Material Noncompliance Federal Awarding Agency: U.S. Department of Education Pass-Through Entity: Georgia Department of Education AL Numbers and Titles: COVID-19 – 84.425D – Elementary and Secondary School Emergency Relief Fund COVID-19 – 84.425U – American Rescue Plan Elementary and Secondary School Emergency Relief Fund COVID-19 – 84.425W – Elementary and Secondary School Emergency Relief Fund Federal Award Number: S4250200012 (Year: 2020), S4250210012 (Year 2021), S425U210012 (Year: 2021), S425W210011 (Year 2021) Questioned Costs: $279,314 Description: The policies and procedures of the School District were insufficient to provide adequate internal controls over expenditures as it relates to the Elementary and Secondary School Emergency Relief Fund program. Background: On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security (CARES) Act was signed into law. The CARES Act was designed to mitigate the economic effects of the COVID-19 pandemic in a variety of ways, including providing additional funding for local educational agencies (LEAs) navigating the impact of the COVID-19 outbreak. Provisions included in Title VIII of the CARES Act created the Education Stabilization Fund to provide financial resources to educational entities to prevent, prepare for, and respond to coronavirus. The CARES Act allocated $30.75 billion, the Coronavirus Response and Relief Supplemental Appropriations Act allocated an additional $81.9 billion, and the American Rescue Plan Act added $165.1 billion in funding to the Education Stabilization Fund. Multiple Education Stabilization Fund subprograms were created and allotted funding through the various COVID-19-related legislation. Of these programs, the Elementary and Secondary School Emergency Relief (ESSER) Fund was created to address the impact that COVID-19 has had, and continues to have, on elementary and secondary schools across the nation. lll FEDERAL AWARD FINDINGS AND QUESTIONED COSTS ESSER funding was granted to the Georgia Department of Education (GaDOE) by the U.S. Department of Education (ED). GaDOE is responsible for distributing funds to LEAs and overseeing the expenditure of funds by LEAs. ESSER funds totaling $3,718,412.45 were expended and reported on the City of Thomasville Board of Education’s Schedule of Expenditures of Federal Awards (SEFA) for fiscal year 2022. Criteria: As a recipient of federal awards, the School District is required to establish and maintain effective internal control over federal awards that provides reasonable assurance of managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards pursuant to Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), Section 200.303 – Internal Controls. Additionally, provisions included in the Uniform Guidance, Section 200.403 – Factors Affecting Allowability of Costs state that “costs must meet the following general criteria in order to be allowable under Federal awards: (a) Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles, (b) Conform to any limitations or exclusions set forth in these principles or in the Federal award as to types or amount of cost items, (c) Be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity… (g) Be adequately documented…” In addition, provisions included in the Uniform Guidance, Section 202.403 – Reasonable Costs state that “a cost is reasonable if, in its nature and amount, it does not exceed that which would be incurred by a prudent person under the circumstances prevailing at the time the decision was made to incur the cost. The question of reasonableness is particularly important when the non-Federal entity is predominantly federally-funded. In determining reasonableness of a given cost, consideration must be given to: (a) Whether the cost is of a type generally recognized as ordinary and necessary for the operation of the non-Federal entity or the proper and efficient performance of the Federal award. (b) The restraints or requirements imposed by such factors as: sound business practices; arm’s-length bargaining; Federal, state, local, tribal, and other laws and regulations; and terms and conditions of the Federal award… (d) Whether the individuals concerned acted with prudence in the circumstances considering their responsibilities to the non-Federal entity, its employees, where applicable its students or membership, the public at large, and the Federal Government. (e) Whether the non-Federal entity significantly deviates from its established practices and policies regarding the incurrence of costs, which may unjustifiably increase the Federal award’s cost.” Furthermore, provisions included in the Uniform Guidance, Section 200.318 – General Procurement Standards state that “the non-Federal entity must have and use documented procurement procedures, consistent with State, local, and tribal laws and regulations… for the acquisition of property or services required under a Federal award or subaward…” Condition: Auditors performed a review of expenditure activity associated with the ESSER program to determine if appropriate internal controls were implemented and applicable compliance requirements were met. This testing revealed that “retention” bonuses were paid to individuals who were not employees of the School District. These individuals were hired to perform specific functions as detailed within the associated contracts and were paid amounts in excess of the stated rate noted within these contracts. Furthermore, the School District does not have the authority or ability to retain these individuals as lll FEDERAL AWARD FINDINGS AND QUESTIONED COSTS they were not employees of the School District and contract provisions requiring the individuals to remain employed by the companies and in the service of the School District for a stated period of time were not reflected within the associated contract. Therefore, expenditures totaling $60,315.00 were not considered to be reasonable and necessary for the performance of the ESSER program and deemed unallowable. Questioned Costs: Known questioned costs of $60,315.00 were identified for expenditures that were not incurred for a necessary and reasonable purpose and did not follow the School District’s policies and procedures. Using the population being sampled, which totaled $329,101.23, we project the likely questioned costs to be approximately $279,314.22. Cause: Per discussion with management, the School District believed that the expenditures were allowable as the expenditures were approved by GaDOE through the Consolidated Application process and approved by the local Board of Education; however, they were not aware that contract amendments should be initiated prior to the expenditure of funds in this manner. Effect: The School District is not in compliance with the Uniform Guidance or GaDOE guidance related to the ESSER program. Failure to ensure that appropriate policies and procedures are followed when expending federal funds may expose the School District to unnecessary financial strain and shortages and GaDOE may require the School District to return funds associated with unallowable expenditures. Recommendation: The School District should review current internal control procedures related to ESSER program expenditures. Where vulnerable, the School District should develop and/or modify its policies and procedures to ensure that expenditures are in line with provisions reflected within the associated contract and/or contract amendments. In addition, the School District should implement a monitoring process to ensure that all expenditures are compliant with the School District’s purchasing policies and procedures. Views of Responsible Officials: We concur with this finding.
2022-001 – Uniform Guidance Procurement Standards Criteria: One of the more significant provisions of the Uniform Guidance that affects the Town is the procurement standards under 2 CFR sections 200.318 through 200.326. Under the procurement standards, the Town is required to have a documented purchasing policy, which at a minimum, incorporates the provisions of the Uniform Guidance. Statement of Condition: The Office of Management and Budget (OMB) revised regulations applicable to federally funded programs. The regulations are contained in Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). The Uniform Guidance replaced OMB Circulars A-133, A-87, and A-110 and incorporates requirements for grant recipients. The Uniform Guidance includes not only protocols for program management and administration, but also updates compliance regulations for federal awards. Cause: The Town had not adopted a procurement policy that covered all aspects required by the Uniform Guidance. However, during our testing of procurement over federal expenditures, we did not notate any violations of the Uniform Guidance procurement standards. Effect: Items required by the Uniform Guidance procurement standards were not addressed in the policy followed by the Town during the fiscal year. Recommendation: We recommend that management review the applicable provisions of the Uniform Guidance procurement standards and update the Town’s procurement policy appropriately. This would include adding any missing components to the Town’s current procurement policy and updating definitions of types of procurement, i.e. micro-purchases, small purchases, and small acquisition threshold, to match the language used in the Uniform Guidance procurement standards.
FA 2022-002 Strengthen Controls over Procurement Compliance Requirement: Procurement and Suspension and Debarment Internal Control Impact: Significant Deficiency Compliance Impact: Nonmaterial Noncompliance Federal Awarding Agency: U.S. Department of Agriculture Pass-Through Entity: Georgia Department of Education AL Numbers and Titles: 10.553 – School Breakfast Program 10.555 – National School Lunch Program Federal Award Numbers: 225GA324N1199 (Year: 2022) Questioned Costs: None Identified Description: A review of expenditures charged to the Child Nutrition Cluster revealed that the School District’s internal control procedures were not operating appropriately to ensure that the School District’s procurement procedures were followed. Background Information: The Child Nutrition Cluster (CNC) is comprised of various programs that are intended to assist states in administering and overseeing food service program operators that provide healthful, nutritious meals to eligible children in public and non-profit private schools, residential child care institutions, and summer programs. This Cluster of programs also fosters healthy eating habits in children by providing fresh fruits and fresh vegetables to children attending elementary and schools and encourages the domestic consumption of nutritious agricultural commodities. CNC funding was granted to the Georgia Department of Education (GaDOE) by the U.S. Department of Agriculture. GaDOE is responsible for distributing funds to local educational agencies (LEAs) and overseeing the various CNC programs. CNC funds totaling $987,385.00 were expended and reported on the Hancock County Board of Education’s Schedule of Expenditures of Federal Awards (SEFA) for fiscal year 2022. Criteria: As a recipient of federal awards, the School District is required to establish and maintain effective internal control over federal awards that provides reasonable assurance of managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards pursuant to Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), Section 200.303 – Internal Controls. Additionally, provisions included in the Uniform Guidance, Section 200.318 – General Procurement Standards state in part that “(a) the non-Federal entity must use its own documented procurement procedures which reflect applicable State, local, and tribal laws and regulations and… (b) non-Federal entities must maintain oversight to ensure that contractors perform in accordance with the terms, conditions, and specifications of their contracts or purchase orders.” In addition, provisions included in the Uniform Guidance, Section 200.320 – Methods of Procurement to Be Followed provide guidance for procurement through small purchase procedures and state “If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources.” Condition: A sample of 60 procurement transactions was randomly selected for testing using a non-statistical sampling approach. These transactions were reviewed to determine if appropriate internal controls were implemented and applicable compliance requirements were met. The following deficiencies were noted: • The School District could not provide evidence that an adequate number of rate or price quotations were obtained from qualified sources for 21 small purchase transactions reviewed. • The School District could not provide evidence that bids or proposals were sought and received from an adequate number of qualified sources for 28 simplified acquisition transactions reviewed. Cause: The School District did not obtain updated quotes from vendors associated with small purchase transactions. For simplified acquisition transactions, the School District stated that when invitations to bid were sent in fiscal years 2019 and 2020, the vendors selected were either the only ones that submitted a bid or submitted the lowest bid; however, no documentation was maintained to evidence that additional bids were sought or received. Further, based on these vendors’ performance, the School District extended the contracts without issuing new invitations to bid in the current fiscal year. Effect or Potential Effect: The School District is not in compliance with the Uniform Guidance and Georgia Department of Education guidance. Failure to appropriately implement procedures to address procurement compliance requirements exposes the School District to unnecessary risk of error and misuse of federal funds and could result in the expenditure of federal funds with unqualified vendors. In addition, this deficiency could lead to the return of grant funds associated with unallowable expenditures. Recommendation: The School District should evaluate and improve internal control procedures to ensure that required procurement methods are properly identified and followed and required procurement documentation is properly identified, safeguarded, and retained. In addition, management should develop a monitoring process to ensure that these procedures are operating appropriately. Views of Responsible Officials: We concur with this finding.
FA 2022-002 Strengthen Controls over Procurement Compliance Requirement: Procurement and Suspension and Debarment Internal Control Impact: Significant Deficiency Compliance Impact: Nonmaterial Noncompliance Federal Awarding Agency: U.S. Department of Agriculture Pass-Through Entity: Georgia Department of Education AL Numbers and Titles: 10.553 – School Breakfast Program 10.555 – National School Lunch Program Federal Award Numbers: 225GA324N1199 (Year: 2022) Questioned Costs: None Identified Description: A review of expenditures charged to the Child Nutrition Cluster revealed that the School District’s internal control procedures were not operating appropriately to ensure that the School District’s procurement procedures were followed. Background Information: The Child Nutrition Cluster (CNC) is comprised of various programs that are intended to assist states in administering and overseeing food service program operators that provide healthful, nutritious meals to eligible children in public and non-profit private schools, residential child care institutions, and summer programs. This Cluster of programs also fosters healthy eating habits in children by providing fresh fruits and fresh vegetables to children attending elementary and schools and encourages the domestic consumption of nutritious agricultural commodities. CNC funding was granted to the Georgia Department of Education (GaDOE) by the U.S. Department of Agriculture. GaDOE is responsible for distributing funds to local educational agencies (LEAs) and overseeing the various CNC programs. CNC funds totaling $987,385.00 were expended and reported on the Hancock County Board of Education’s Schedule of Expenditures of Federal Awards (SEFA) for fiscal year 2022. Criteria: As a recipient of federal awards, the School District is required to establish and maintain effective internal control over federal awards that provides reasonable assurance of managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards pursuant to Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), Section 200.303 – Internal Controls. Additionally, provisions included in the Uniform Guidance, Section 200.318 – General Procurement Standards state in part that “(a) the non-Federal entity must use its own documented procurement procedures which reflect applicable State, local, and tribal laws and regulations and… (b) non-Federal entities must maintain oversight to ensure that contractors perform in accordance with the terms, conditions, and specifications of their contracts or purchase orders.” In addition, provisions included in the Uniform Guidance, Section 200.320 – Methods of Procurement to Be Followed provide guidance for procurement through small purchase procedures and state “If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources.” Condition: A sample of 60 procurement transactions was randomly selected for testing using a non-statistical sampling approach. These transactions were reviewed to determine if appropriate internal controls were implemented and applicable compliance requirements were met. The following deficiencies were noted: • The School District could not provide evidence that an adequate number of rate or price quotations were obtained from qualified sources for 21 small purchase transactions reviewed. • The School District could not provide evidence that bids or proposals were sought and received from an adequate number of qualified sources for 28 simplified acquisition transactions reviewed. Cause: The School District did not obtain updated quotes from vendors associated with small purchase transactions. For simplified acquisition transactions, the School District stated that when invitations to bid were sent in fiscal years 2019 and 2020, the vendors selected were either the only ones that submitted a bid or submitted the lowest bid; however, no documentation was maintained to evidence that additional bids were sought or received. Further, based on these vendors’ performance, the School District extended the contracts without issuing new invitations to bid in the current fiscal year. Effect or Potential Effect: The School District is not in compliance with the Uniform Guidance and Georgia Department of Education guidance. Failure to appropriately implement procedures to address procurement compliance requirements exposes the School District to unnecessary risk of error and misuse of federal funds and could result in the expenditure of federal funds with unqualified vendors. In addition, this deficiency could lead to the return of grant funds associated with unallowable expenditures. Recommendation: The School District should evaluate and improve internal control procedures to ensure that required procurement methods are properly identified and followed and required procurement documentation is properly identified, safeguarded, and retained. In addition, management should develop a monitoring process to ensure that these procedures are operating appropriately. Views of Responsible Officials: We concur with this finding.
FA 2022-002 Strengthen Controls over Procurement Compliance Requirement: Procurement and Suspension and Debarment Internal Control Impact: Significant Deficiency Compliance Impact: Nonmaterial Noncompliance Federal Awarding Agency: U.S. Department of Agriculture Pass-Through Entity: Georgia Department of Education AL Numbers and Titles: 10.553 – School Breakfast Program 10.555 – National School Lunch Program Federal Award Numbers: 225GA324N1199 (Year: 2022) Questioned Costs: None Identified Description: A review of expenditures charged to the Child Nutrition Cluster revealed that the School District’s internal control procedures were not operating appropriately to ensure that the School District’s procurement procedures were followed. Background Information: The Child Nutrition Cluster (CNC) is comprised of various programs that are intended to assist states in administering and overseeing food service program operators that provide healthful, nutritious meals to eligible children in public and non-profit private schools, residential child care institutions, and summer programs. This Cluster of programs also fosters healthy eating habits in children by providing fresh fruits and fresh vegetables to children attending elementary and schools and encourages the domestic consumption of nutritious agricultural commodities. CNC funding was granted to the Georgia Department of Education (GaDOE) by the U.S. Department of Agriculture. GaDOE is responsible for distributing funds to local educational agencies (LEAs) and overseeing the various CNC programs. CNC funds totaling $987,385.00 were expended and reported on the Hancock County Board of Education’s Schedule of Expenditures of Federal Awards (SEFA) for fiscal year 2022. Criteria: As a recipient of federal awards, the School District is required to establish and maintain effective internal control over federal awards that provides reasonable assurance of managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards pursuant to Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), Section 200.303 – Internal Controls. Additionally, provisions included in the Uniform Guidance, Section 200.318 – General Procurement Standards state in part that “(a) the non-Federal entity must use its own documented procurement procedures which reflect applicable State, local, and tribal laws and regulations and… (b) non-Federal entities must maintain oversight to ensure that contractors perform in accordance with the terms, conditions, and specifications of their contracts or purchase orders.” In addition, provisions included in the Uniform Guidance, Section 200.320 – Methods of Procurement to Be Followed provide guidance for procurement through small purchase procedures and state “If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources.” Condition: A sample of 60 procurement transactions was randomly selected for testing using a non-statistical sampling approach. These transactions were reviewed to determine if appropriate internal controls were implemented and applicable compliance requirements were met. The following deficiencies were noted: • The School District could not provide evidence that an adequate number of rate or price quotations were obtained from qualified sources for 21 small purchase transactions reviewed. • The School District could not provide evidence that bids or proposals were sought and received from an adequate number of qualified sources for 28 simplified acquisition transactions reviewed. Cause: The School District did not obtain updated quotes from vendors associated with small purchase transactions. For simplified acquisition transactions, the School District stated that when invitations to bid were sent in fiscal years 2019 and 2020, the vendors selected were either the only ones that submitted a bid or submitted the lowest bid; however, no documentation was maintained to evidence that additional bids were sought or received. Further, based on these vendors’ performance, the School District extended the contracts without issuing new invitations to bid in the current fiscal year. Effect or Potential Effect: The School District is not in compliance with the Uniform Guidance and Georgia Department of Education guidance. Failure to appropriately implement procedures to address procurement compliance requirements exposes the School District to unnecessary risk of error and misuse of federal funds and could result in the expenditure of federal funds with unqualified vendors. In addition, this deficiency could lead to the return of grant funds associated with unallowable expenditures. Recommendation: The School District should evaluate and improve internal control procedures to ensure that required procurement methods are properly identified and followed and required procurement documentation is properly identified, safeguarded, and retained. In addition, management should develop a monitoring process to ensure that these procedures are operating appropriately. Views of Responsible Officials: We concur with this finding.
FA 2022-002 Strengthen Controls over Procurement Compliance Requirement: Procurement and Suspension and Debarment Internal Control Impact: Significant Deficiency Compliance Impact: Nonmaterial Noncompliance Federal Awarding Agency: U.S. Department of Agriculture Pass-Through Entity: Georgia Department of Education AL Numbers and Titles: 10.553 – School Breakfast Program 10.555 – National School Lunch Program Federal Award Numbers: 225GA324N1199 (Year: 2022) Questioned Costs: None Identified Description: A review of expenditures charged to the Child Nutrition Cluster revealed that the School District’s internal control procedures were not operating appropriately to ensure that the School District’s procurement procedures were followed. Background Information: The Child Nutrition Cluster (CNC) is comprised of various programs that are intended to assist states in administering and overseeing food service program operators that provide healthful, nutritious meals to eligible children in public and non-profit private schools, residential child care institutions, and summer programs. This Cluster of programs also fosters healthy eating habits in children by providing fresh fruits and fresh vegetables to children attending elementary and schools and encourages the domestic consumption of nutritious agricultural commodities. CNC funding was granted to the Georgia Department of Education (GaDOE) by the U.S. Department of Agriculture. GaDOE is responsible for distributing funds to local educational agencies (LEAs) and overseeing the various CNC programs. CNC funds totaling $987,385.00 were expended and reported on the Hancock County Board of Education’s Schedule of Expenditures of Federal Awards (SEFA) for fiscal year 2022. Criteria: As a recipient of federal awards, the School District is required to establish and maintain effective internal control over federal awards that provides reasonable assurance of managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards pursuant to Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), Section 200.303 – Internal Controls. Additionally, provisions included in the Uniform Guidance, Section 200.318 – General Procurement Standards state in part that “(a) the non-Federal entity must use its own documented procurement procedures which reflect applicable State, local, and tribal laws and regulations and… (b) non-Federal entities must maintain oversight to ensure that contractors perform in accordance with the terms, conditions, and specifications of their contracts or purchase orders.” In addition, provisions included in the Uniform Guidance, Section 200.320 – Methods of Procurement to Be Followed provide guidance for procurement through small purchase procedures and state “If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources.” Condition: A sample of 60 procurement transactions was randomly selected for testing using a non-statistical sampling approach. These transactions were reviewed to determine if appropriate internal controls were implemented and applicable compliance requirements were met. The following deficiencies were noted: • The School District could not provide evidence that an adequate number of rate or price quotations were obtained from qualified sources for 21 small purchase transactions reviewed. • The School District could not provide evidence that bids or proposals were sought and received from an adequate number of qualified sources for 28 simplified acquisition transactions reviewed. Cause: The School District did not obtain updated quotes from vendors associated with small purchase transactions. For simplified acquisition transactions, the School District stated that when invitations to bid were sent in fiscal years 2019 and 2020, the vendors selected were either the only ones that submitted a bid or submitted the lowest bid; however, no documentation was maintained to evidence that additional bids were sought or received. Further, based on these vendors’ performance, the School District extended the contracts without issuing new invitations to bid in the current fiscal year. Effect or Potential Effect: The School District is not in compliance with the Uniform Guidance and Georgia Department of Education guidance. Failure to appropriately implement procedures to address procurement compliance requirements exposes the School District to unnecessary risk of error and misuse of federal funds and could result in the expenditure of federal funds with unqualified vendors. In addition, this deficiency could lead to the return of grant funds associated with unallowable expenditures. Recommendation: The School District should evaluate and improve internal control procedures to ensure that required procurement methods are properly identified and followed and required procurement documentation is properly identified, safeguarded, and retained. In addition, management should develop a monitoring process to ensure that these procedures are operating appropriately. Views of Responsible Officials: We concur with this finding.
FA 2022-001 Strengthen Controls over Expenditures Compliance Requirements: Activities Allowed or Unallowed Allowable Costs/Cost Principles Procurement and Suspension and Debarment Internal Control Impact: Significant Deficiency Compliance Impact: Nonmaterial Noncompliance Federal Awarding Agency: U.S. Department of Agriculture Pass-Through Entity: Georgia Department of Education AL Numbers and Titles: 10.553 – School Breakfast Program 10.555 – National School Lunch Program Federal Award Number: 225GA324N1199 (Year: 2022) Questioned Costs: $21,440 Description: A review of expenditures charged to the Child Nutrition Cluster revealed that the School District’s internal control procedures were not operating appropriately to ensure that the School District’s procurement procedures were followed. Background: The Child Nutrition Cluster (CNC) is comprised of various programs that are intended to assist states in administering and overseeing food service program operators that provide healthful, nutritious meals to eligible children in public and non-profit private schools, residential child care institutions, and summer programs. This Cluster of programs also fosters healthy eating habits in children by providing fresh fruits and fresh vegetables to children attending elementary and secondary schools and encourages the domestic consumption of nutritious agricultural commodities. CNC funding was granted to the Georgia Department of Education (GaDOE) by the U.S. Department of Agriculture. GaDOE is responsible for distributing funds to local educational agencies (LEAs) and overseeing the various CNC programs. CNC funds totaling $2,662,705 were expended and reported on the Harris County Board of Education’s Schedule of Expenditures of Federal Awards (SEFA) for fiscal year 2022. Criteria: As a recipient of federal awards, the School District is required to establish and maintain effective internal control over federal awards that provides reasonable assurance of managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards pursuant to Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), Section 200.303 – Internal Controls. Additionally, provisions included in the Uniform Guidance, Section 200.318 – General Procurement Standards state in part that “(a) the non-Federal entity must use its own documented procurement procedures which reflect applicable State, local, and tribal laws and regulations and… (b) non-Federal entities must maintain oversight to ensure that contractors perform in accordance with the terms, conditions, and specifications of their contracts or purchase orders.” In addition, provisions included in the Uniform Guidance, Section 200.320 – Methods of Procurement to Be Followed provide guidance for procurement through small purchase procedures and state “If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources.” Condition: A sample of 28 procurement transactions was randomly selected for testing using a non-statistical sampling approach. These transactions were reviewed to determine if appropriate internal controls were implemented and applicable compliance requirements were met. The following deficiencies were noted: • For three expenditures, evidence of review and approval was not reflected within the voucher package. • The appropriate procurement method was not used for the dollar amount and conditions associated with one procurement transaction that should have been considered a simplified acquisition transaction. Therefore, the School District could not provide evidence that an adequate number of sealed bids were sought and obtained from qualified sources. Questioned Costs: Upon testing a sample of $130,284 in procurement transactions, known questioned costs of $21,440 were identified for expenditures that did not follow the School District’s procurement procedures. Using the total sample population of $518,395 in procurement transactions, we project the likely questioned costs to be approximately $85,310. The following Assistance Listing Numbers were affected by known and likely questioned costs: 10.553 and 10.555. Cause: The School District did not follow its policies and procedures that govern the procurement process for federal programs. Effect: The School District is not in compliance with the Uniform Guidance and GaDOE guidance. Failure to appropriately implement procedures to address procurement compliance requirements exposes the School District to unnecessary risk of error and misuse of federal funds and could result in the expenditure of federal funds with unqualified vendors. In addition, this deficiency could lead to the return of grant funds associated with unallowable expenditures. Recommendation: The School District should evaluate and improve internal control procedures to ensure that required procurement methods are properly identified and followed and required procurement documentation is properly safeguarded and retained. In addition, management should develop a monitoring process to ensure that these procedures are operating appropriately. Views of Responsible Officials: We concur with the finding.
FA 2022-001 Strengthen Controls over Expenditures Compliance Requirements: Activities Allowed or Unallowed Allowable Costs/Cost Principles Procurement and Suspension and Debarment Internal Control Impact: Significant Deficiency Compliance Impact: Nonmaterial Noncompliance Federal Awarding Agency: U.S. Department of Agriculture Pass-Through Entity: Georgia Department of Education AL Numbers and Titles: 10.553 – School Breakfast Program 10.555 – National School Lunch Program Federal Award Number: 225GA324N1199 (Year: 2022) Questioned Costs: $21,440 Description: A review of expenditures charged to the Child Nutrition Cluster revealed that the School District’s internal control procedures were not operating appropriately to ensure that the School District’s procurement procedures were followed. Background: The Child Nutrition Cluster (CNC) is comprised of various programs that are intended to assist states in administering and overseeing food service program operators that provide healthful, nutritious meals to eligible children in public and non-profit private schools, residential child care institutions, and summer programs. This Cluster of programs also fosters healthy eating habits in children by providing fresh fruits and fresh vegetables to children attending elementary and secondary schools and encourages the domestic consumption of nutritious agricultural commodities. CNC funding was granted to the Georgia Department of Education (GaDOE) by the U.S. Department of Agriculture. GaDOE is responsible for distributing funds to local educational agencies (LEAs) and overseeing the various CNC programs. CNC funds totaling $2,662,705 were expended and reported on the Harris County Board of Education’s Schedule of Expenditures of Federal Awards (SEFA) for fiscal year 2022. Criteria: As a recipient of federal awards, the School District is required to establish and maintain effective internal control over federal awards that provides reasonable assurance of managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards pursuant to Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), Section 200.303 – Internal Controls. Additionally, provisions included in the Uniform Guidance, Section 200.318 – General Procurement Standards state in part that “(a) the non-Federal entity must use its own documented procurement procedures which reflect applicable State, local, and tribal laws and regulations and… (b) non-Federal entities must maintain oversight to ensure that contractors perform in accordance with the terms, conditions, and specifications of their contracts or purchase orders.” In addition, provisions included in the Uniform Guidance, Section 200.320 – Methods of Procurement to Be Followed provide guidance for procurement through small purchase procedures and state “If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources.” Condition: A sample of 28 procurement transactions was randomly selected for testing using a non-statistical sampling approach. These transactions were reviewed to determine if appropriate internal controls were implemented and applicable compliance requirements were met. The following deficiencies were noted: • For three expenditures, evidence of review and approval was not reflected within the voucher package. • The appropriate procurement method was not used for the dollar amount and conditions associated with one procurement transaction that should have been considered a simplified acquisition transaction. Therefore, the School District could not provide evidence that an adequate number of sealed bids were sought and obtained from qualified sources. Questioned Costs: Upon testing a sample of $130,284 in procurement transactions, known questioned costs of $21,440 were identified for expenditures that did not follow the School District’s procurement procedures. Using the total sample population of $518,395 in procurement transactions, we project the likely questioned costs to be approximately $85,310. The following Assistance Listing Numbers were affected by known and likely questioned costs: 10.553 and 10.555. Cause: The School District did not follow its policies and procedures that govern the procurement process for federal programs. Effect: The School District is not in compliance with the Uniform Guidance and GaDOE guidance. Failure to appropriately implement procedures to address procurement compliance requirements exposes the School District to unnecessary risk of error and misuse of federal funds and could result in the expenditure of federal funds with unqualified vendors. In addition, this deficiency could lead to the return of grant funds associated with unallowable expenditures. Recommendation: The School District should evaluate and improve internal control procedures to ensure that required procurement methods are properly identified and followed and required procurement documentation is properly safeguarded and retained. In addition, management should develop a monitoring process to ensure that these procedures are operating appropriately. Views of Responsible Officials: We concur with the finding.
Material Weakness in Internal Control over Compliance and Material Noncompliance Research and Development Cluster Criteria: Non-federal entities other than states must follow the procurement standards set out at 2 CFR 200.318 through 200.326. They must use their own documented procedures, which reflect applicable state and local laws and regulations, provided that the procurement standards conform to the applicable federal statutes and the procurement requirements identified in 2 CFR part 200. Condition: The Organization has a procurement policy in place; however, the Organization is not consistently following the procurement policy. During the period of the contracts with these provisions, the Organization did not have a control structure in place to monitor compliance with procurement requirements. Consequently, for four (4) of four (4) contracts tested, the procurement policy was not followed and no documentation to reflect compliance with Uniform Guidance requirements related to procurement could be provided. Cause: The Organization did not have proper controls in place to monitor compliance with the procurement. Effect or potential effect: The procurement policy retained by the Organization has not been updated to confirm to the Organization’s current operations. The Organization could become noncompliant with the requirements of the Uniform Guidance, resulting in findings and questioned costs related to dollar amounts being expended to vendors. Additionally, the Organization could become ineligible to receive funds from federal entities or may have to issue refunds to federal entities. Questioned costs: None. Context: Our sample was not intended to be statistically valid. Recommendation: The Organization should update its procurement policy to reflect current operations. Additionally, the Organization should review the current procurement operations in conjunction with the review of the procurement policies to ensure that all practices and policies conform to the standards promulgated by the CFR. Views of responsible officials and planned corrective actions: Management's response is reported in "Management's Views and Corrective Action Plan" included at the end of this report. Identification of prior year finding: 2021-005
2022-004 - Internal Control over Procurement (SD, NC) Criteria: Pursuant to the Office of Management and Budget (OMB) 2 CFR Part 200, Appendix XI, Compliance Supplement August 2022, sections 3.2-I-1 through 3.2-I-3: "Non-Federal entities other than States... must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable Federal statutes and the procurement requirements identified in 2 CFR part 200. A non-Federal entity must: 1. Meet the general procurement standards in 2 CFR section 200.318, which include oversight of contracters' performance, maintaining written standards of conduct for employees involved in contracting, awarding contracts only to responsible contractors, and maintaining records to document history of procurements... Cost-Reimbursement Contracts under the Federal Acquisition Regulation subcontracts, non-Federal entities receiving cost-reimbursement contracts under the FAR must comply with the clauses at 48 CFR section 52.244-2 (consent to subcontract), 52.244-5 (competition), 52.203-13 (code of business ethics), 52.203-16 (conflicts of interest), and 52.215.12 (cost or pricing data); and the terms and conditions of the contract. The FAR defines "subcontracts" as a contraact, i.e., a mutually binding legal relationship obligation the seller to furnish the supplies or services (including construction) and the buyer to pay for them, entered into by a subcontractor to furnish supplies or services for performance of a prime contract or a subcontract. It includes, but is not limited to, purchase orders, and changes and modifications to purchase orders. Condition: The City does not have a current official written policy for procurement and contracts conforming to applicable Federal statutes and the updated procurement requirements per 2 CFR part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). The City effective Conflict Interest Code did not include the required language per the Uniform Guidance. Cause: Lack of formal policies and procedures over current required procurement standards and lack of internal controls and adequate staff training on effective requirements set forth by the Uniform Guidance over procurement. Effect or Potential Effect: Failure to document and retain evidence that procurement procedures were followed could result in the need to reimburse Federal funds. Questioned Cost: None Context: The City does not have an effective purchasing manual for city-wide use. The City-provided policy and procedure document establishing purchasing guidelines is for Finance Department use. We noted that this document was last updated on September 7, 2004 and does not contain the language required by the Uniform Guidance. We reviewed the City's current effective conflict of interest code and purchasing policy and procedure document and noted no provisions containing the required language per the Uniform Guidance. Statistical Sampling Validity: Non-statistical sampling was performed in relation to this finding. Repeat of a Prior-Year Finding: Yes, 2019-014, 2021-006 Recommendation: We recommend the City establish an official written policy for procurement and contracting and Conflict of Interest Code that are in line with the requirements of the Uniform Guidance. (MW) (SD) (BP) (NC) -17- The policy should contain components for compliance with and references to Federal requirements, such as language establishing contract files that document significant procurement history; methods of procurement authorized including selection of contract type, contractor selection or rejection, and the basis of contract price; verification that procurements provide full and open competition when required; requirements for cost or price analysis, including for contract modifications; obtaining and reacting to suspension and debarment. The City should strengthen its procurement internal controls based on this official written policy. Management Response and Corrective Action Plan City's Response: The City concurs with the recommendation. Corrective Action Plan: The City will continue to address this finding through updating of policies and procedures for City-wide use. Update: in November 2023 the City updated the policies and procedures manual that was accepted by the DOJ in December 2023. Planned Implementation Date: June 30, 2024 Responsible Person: Finance Department
Finding 2022-005: Procurement Information on the Federal Programs: Assistance Listing Number 98.001 Criteria: CFR 200.318 states that non-Federal entities must have and use documented procurement procedures consistent with the requirements for procurement regulations included in paragraphs 318 through 327. Condition: Astraea's procurement policy references CFR 200.318-327 however the policy does not note how it will comply with the requirements and what the process is to ensure compliance is achieved. During our audit we noted multiple instances where vendors were engaged without any documentation of procurement process or justification to support using a noncompetitive procurement process in accordance with CFR 200.320(c). Cause: Astraea does not have a procedure in place to ensure all vendors or suppliers paid with Federal funding are engaged in compliance with the Federal regulations. Context: Without updating the policy to comply with CFR 200, Astraea is at risk of entering into contracts for goods or services under Federal awards that were not adequately procured based on the regulations in the Uniform Guidance and the awarding agency or pass-through entity could disallow the costs paid for the goods or services. Effect: Astraea may have disallowed costs for not properly procuring goods or services. Questioned Costs: None noted. Identification as a Repeat Finding: Yes - 2021-006. Recommendation: We recommend Astraea update the procurement policy to become compliant with CFR 200. We further recommend it ensure all staff are properly trained with respect to the new policy to ensure compliance.
Criteria: Non-federal entities, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicablestate and local laws and regulations, provided the policies and procedures conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200.Condition/context: A sample of 2 expenditures greater than the micropurchase threshold of $10,000 but less than the simplified acquisition threshold of $250,000 were selected from the three transactions that exceeded the micropurchase threshold of $10,000. For one of the expenditures the University did not obtain the required rate quotations; per the University?s documented policy two quotes should have been obtained. In addition, we noted the University does not have a documented standard of conduct that covers conflicts of interest and governs the performance of its employees engaged in the selection, award, and administration of contracts.Our sample was not, and was not intended to be, statistically valid.Questioned costs: None.Cause/Effect: The personnel completing purchases on behalf of the University were unaware of the internal procurement policies that are in conformance with federal statutes and 2 CFR Part 200. The lack of obtaining the required rate quotations increases the risk that the price paid was not competitive when compared to the market and that the transaction may not have been in a manner providing full and opencompetition. The lack of a documented standard of conduct that covers conflict of interest increases the risk that an actual or perceived conflict could occur.Repeat finding: NoRecommendation: We recommend the University implement controls to ensure all employees making federal purchases on behalf of the University are aware of the University?s documented procurement policy that is in accordance with 2 CFR Part 200. In addition, we recommend the University document its standard of conduct that covers conflicts of interest and governs the performance of its employees engaged in the selection, award, and administration of contracts.Views of responsible officials and planned corrective actions: Heritage University agrees to put procedures in place to make certain that every employee making federal purchases on the University's behalf is aware of the University's written procurement policy, which complies with 2 CFR Part 200. Additionally, the University is to formalize its code of conduct, which addresses conflicts of interest and establishes expectations for staff members involved in contract administration, selection, and award.
Criteria: Non-federal entities, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicablestate and local laws and regulations, provided the policies and procedures conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200.Condition/context: A sample of 2 expenditures greater than the micropurchase threshold of $10,000 but less than the simplified acquisition threshold of $250,000 were selected from the three transactions that exceeded the micropurchase threshold of $10,000. For one of the expenditures the University did not obtain the required rate quotations; per the University?s documented policy two quotes should have been obtained. In addition, we noted the University does not have a documented standard of conduct that covers conflicts of interest and governs the performance of its employees engaged in the selection, award, and administration of contracts.Our sample was not, and was not intended to be, statistically valid.Questioned costs: None.Cause/Effect: The personnel completing purchases on behalf of the University were unaware of the internal procurement policies that are in conformance with federal statutes and 2 CFR Part 200. The lack of obtaining the required rate quotations increases the risk that the price paid was not competitive when compared to the market and that the transaction may not have been in a manner providing full and opencompetition. The lack of a documented standard of conduct that covers conflict of interest increases the risk that an actual or perceived conflict could occur.Repeat finding: NoRecommendation: We recommend the University implement controls to ensure all employees making federal purchases on behalf of the University are aware of the University?s documented procurement policy that is in accordance with 2 CFR Part 200. In addition, we recommend the University document its standard of conduct that covers conflicts of interest and governs the performance of its employees engaged in the selection, award, and administration of contracts.Views of responsible officials and planned corrective actions: Heritage University agrees to put procedures in place to make certain that every employee making federal purchases on the University's behalf is aware of the University's written procurement policy, which complies with 2 CFR Part 200. Additionally, the University is to formalize its code of conduct, which addresses conflicts of interest and establishes expectations for staff members involved in contract administration, selection, and award.
Criteria: Non-federal entities, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicablestate and local laws and regulations, provided the policies and procedures conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200.Condition/context: A sample of 2 expenditures greater than the micropurchase threshold of $10,000 but less than the simplified acquisition threshold of $250,000 were selected from the three transactions that exceeded the micropurchase threshold of $10,000. For one of the expenditures the University did not obtain the required rate quotations; per the University?s documented policy two quotes should have been obtained. In addition, we noted the University does not have a documented standard of conduct that covers conflicts of interest and governs the performance of its employees engaged in the selection, award, and administration of contracts.Our sample was not, and was not intended to be, statistically valid.Questioned costs: None.Cause/Effect: The personnel completing purchases on behalf of the University were unaware of the internal procurement policies that are in conformance with federal statutes and 2 CFR Part 200. The lack of obtaining the required rate quotations increases the risk that the price paid was not competitive when compared to the market and that the transaction may not have been in a manner providing full and opencompetition. The lack of a documented standard of conduct that covers conflict of interest increases the risk that an actual or perceived conflict could occur.Repeat finding: NoRecommendation: We recommend the University implement controls to ensure all employees making federal purchases on behalf of the University are aware of the University?s documented procurement policy that is in accordance with 2 CFR Part 200. In addition, we recommend the University document its standard of conduct that covers conflicts of interest and governs the performance of its employees engaged in the selection, award, and administration of contracts.Views of responsible officials and planned corrective actions: Heritage University agrees to put procedures in place to make certain that every employee making federal purchases on the University's behalf is aware of the University's written procurement policy, which complies with 2 CFR Part 200. Additionally, the University is to formalize its code of conduct, which addresses conflicts of interest and establishes expectations for staff members involved in contract administration, selection, and award.
Criteria or specific requirement: Non-federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200.Condition: The College had a procurement policy that conformed to 2 CFR Part 200. Yet, during our testing, we noted that the College?s procurement policies were not followed. There was a single vendor who provided similar goods and services across two grants which had cumulative purchases over $10,000 within the fiscal year. This triggered Small Purchase compliance requirements to be followed; however, there was no documentation to support compliance.Questioned costs: None.Context: We tested a sample of five vendors and noted one vendor had the exception noted above.Cause: The College focused on the individual amounts being charged to the separate grants, not the cumulative amount paid to the vendor for the goods and services being provided.Effect: The College is not in compliance with their policy, nor are they in compliance with the prescribed methods of procurement as outlined in 2 CFR Part 200.320 to ensure reasonable price or rate.Repeat finding: No.Recommendation: We recommend that the College ensure its policies and procedures over procurement are being enforced to ensure reasonable prices and rates. Specifically, the College should consider training employees that regulations do apply when a single vendor is being used for a good or service, yet the charges are split amongst various funding sources.View of responsible official: The College agrees with the finding.
2022-002 Department of Health and Human Services, Passed Through Substance Abuse andMental Health Services Administration,Section 223 Demonstration Programs to Improve Community Mental Health ServicesListing 93.829, H79SM085287, 8/31/2021 ? 8/30/2022Procurement, Suspension and DebarmentMaterial Weakness in Internal Control over ComplianceCriteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effectiveinternal control over the federal award the provides assurance that the entity ismanaging the federal award in compliance with federal statutes, regulations andconditions of the federal award. 2 CFR 200.318(c)(1) provides that the auditee mustmaintain written standards of conduct covering conflicts of interest and governing theactions of its employees engaged in the selection, award, and administration ofcontracts. 2 CFR 200.319(c) establishes that the auditee must have written proceduresfor procurement transactions.As outlined in 2 CFR 180, recipients must not utilize any vendor which is suspended ordebarred or is otherwise excluded from the central contractor registry.Condition: Hope?s formally documented policy did not include many of the necessary procurementprovisions. Expenditures under the federal grants did not have a consistent control inplace to check applicable vendors for potential suspension and/or debarment for coveredtransactions. Current controls are not documented to provide for a proper audit trail.Cause: Hope does not have a consistent procurement process in place including all federalrequirements or to check vendors under covered transactions ($25,000 or more) inaccordance with federal regulations.Effect: Hope could be out of compliance with federal requirements when entering intoprocurement contracts as well as not meeting suspension and debarment requirementsby potentially contracting with a suspended or debarred vendor.Questioned costs: None reported.Context: Procurement requirements were applicable to 2 transactions, both of which wereselected for testing and were in excess of the micro-purchase threshold but were not inexcess of $250,000. Suspension and Debarment requirements were applicable to bothtransactions tested.Repeat FindingFrom Prior Year: No Recommendation: The policy should be updated to include all federal requirements for procurement.Further, control procedures should be implemented to ensure that all vendors undercovered transactions are checked against the federal website for vendors that could besuspended or debarred prior to transacting with such vendors, or another process asallowed by the federal regulations discussed above. We also suggest that managementretain documentation to support that the control process was followed.Views ofResponsible Officials: We agree with the finding.
Finding Number: 2022-002Prior Year Finding: NoFederal Agency: U.S. Department of EducationFederal Program: Special Education ClusterAssistance Listing: 84.027, 84.173Pass-Through Entity: Maryland State Department of EducationPass-Through AwardNumber and Period:211021-03 (10/1/20 ? 9/30/22)220391-02 (7/1/21 ? 9/30/23)221324-01 (7/1/21 ? 9/30/23)Compliance Requirement: ProcurementType of Finding Significant Deficiency in Internal Control over Compliance,Other MattersCriteria or Specific Requirement:Compliance: Per 2 CFR section 200.318, a non-Federal entity must have and use documentedprocurement procedures, consistent with State, local, and tribal laws and regulations and the standardsof this section, for the acquisition of property or services required under a Federal award or subaward.Per 2 CFR section 200.319, all procurement transactions for the acquisition of property or servicesrequired under a Federal award must be conducted in a manner providing full and open competitionconsistent with the standards of this section and ? 200.320.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effectiveinternal control over the Federal award that provides reasonable assurance that the non-federal entityis managing the federal award in compliance with federal statutes, regulations, and the terms andconditions of the federal award. These internal controls should comply with the guidance in "Standardsfor Internal Control in the Federal Government" issued by the Comptroller General of the United Statesor the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizationsof the Treadway Commission (COSO).Condition/Context:Per its approved Procurement Policy, the Board is required to obtain 2 quotes for purchases between$15,000 and $50,000. We noted 4 out of 8 samples where only 1 quote was obtained for purchaseswithin the thresholds noted above.Questioned Costs:None noted.Cause:The Board did not retain documentation as to why the Procurement Policy was not followed.Effect: The Board could be circumventing the Procurement Policy.Recommendation:We recommend that the Board ensures that documentation of Procurement's decisions on anypurchases that are excluded from the requirements noted in the Procurement Policy are retained foraudit purposes.Views of responsible officials:Management agrees with the finding.
Finding Number: 2022-002Prior Year Finding: NoFederal Agency: U.S. Department of EducationFederal Program: Special Education ClusterAssistance Listing: 84.027, 84.173Pass-Through Entity: Maryland State Department of EducationPass-Through AwardNumber and Period:211021-03 (10/1/20 ? 9/30/22)220391-02 (7/1/21 ? 9/30/23)221324-01 (7/1/21 ? 9/30/23)Compliance Requirement: ProcurementType of Finding Significant Deficiency in Internal Control over Compliance,Other MattersCriteria or Specific Requirement:Compliance: Per 2 CFR section 200.318, a non-Federal entity must have and use documentedprocurement procedures, consistent with State, local, and tribal laws and regulations and the standardsof this section, for the acquisition of property or services required under a Federal award or subaward.Per 2 CFR section 200.319, all procurement transactions for the acquisition of property or servicesrequired under a Federal award must be conducted in a manner providing full and open competitionconsistent with the standards of this section and ? 200.320.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effectiveinternal control over the Federal award that provides reasonable assurance that the non-federal entityis managing the federal award in compliance with federal statutes, regulations, and the terms andconditions of the federal award. These internal controls should comply with the guidance in "Standardsfor Internal Control in the Federal Government" issued by the Comptroller General of the United Statesor the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizationsof the Treadway Commission (COSO).Condition/Context:Per its approved Procurement Policy, the Board is required to obtain 2 quotes for purchases between$15,000 and $50,000. We noted 4 out of 8 samples where only 1 quote was obtained for purchaseswithin the thresholds noted above.Questioned Costs:None noted.Cause:The Board did not retain documentation as to why the Procurement Policy was not followed.Effect: The Board could be circumventing the Procurement Policy.Recommendation:We recommend that the Board ensures that documentation of Procurement's decisions on anypurchases that are excluded from the requirements noted in the Procurement Policy are retained foraudit purposes.Views of responsible officials:Management agrees with the finding.
Finding Number: 2022-002Prior Year Finding: NoFederal Agency: U.S. Department of EducationFederal Program: Special Education ClusterAssistance Listing: 84.027, 84.173Pass-Through Entity: Maryland State Department of EducationPass-Through AwardNumber and Period:211021-03 (10/1/20 ? 9/30/22)220391-02 (7/1/21 ? 9/30/23)221324-01 (7/1/21 ? 9/30/23)Compliance Requirement: ProcurementType of Finding Significant Deficiency in Internal Control over Compliance,Other MattersCriteria or Specific Requirement:Compliance: Per 2 CFR section 200.318, a non-Federal entity must have and use documentedprocurement procedures, consistent with State, local, and tribal laws and regulations and the standardsof this section, for the acquisition of property or services required under a Federal award or subaward.Per 2 CFR section 200.319, all procurement transactions for the acquisition of property or servicesrequired under a Federal award must be conducted in a manner providing full and open competitionconsistent with the standards of this section and ? 200.320.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effectiveinternal control over the Federal award that provides reasonable assurance that the non-federal entityis managing the federal award in compliance with federal statutes, regulations, and the terms andconditions of the federal award. These internal controls should comply with the guidance in "Standardsfor Internal Control in the Federal Government" issued by the Comptroller General of the United Statesor the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizationsof the Treadway Commission (COSO).Condition/Context:Per its approved Procurement Policy, the Board is required to obtain 2 quotes for purchases between$15,000 and $50,000. We noted 4 out of 8 samples where only 1 quote was obtained for purchaseswithin the thresholds noted above.Questioned Costs:None noted.Cause:The Board did not retain documentation as to why the Procurement Policy was not followed.Effect: The Board could be circumventing the Procurement Policy.Recommendation:We recommend that the Board ensures that documentation of Procurement's decisions on anypurchases that are excluded from the requirements noted in the Procurement Policy are retained foraudit purposes.Views of responsible officials:Management agrees with the finding.
Finding Number: 2022-002Prior Year Finding: NoFederal Agency: U.S. Department of EducationFederal Program: Special Education ClusterAssistance Listing: 84.027, 84.173Pass-Through Entity: Maryland State Department of EducationPass-Through AwardNumber and Period:211021-03 (10/1/20 ? 9/30/22)220391-02 (7/1/21 ? 9/30/23)221324-01 (7/1/21 ? 9/30/23)Compliance Requirement: ProcurementType of Finding Significant Deficiency in Internal Control over Compliance,Other MattersCriteria or Specific Requirement:Compliance: Per 2 CFR section 200.318, a non-Federal entity must have and use documentedprocurement procedures, consistent with State, local, and tribal laws and regulations and the standardsof this section, for the acquisition of property or services required under a Federal award or subaward.Per 2 CFR section 200.319, all procurement transactions for the acquisition of property or servicesrequired under a Federal award must be conducted in a manner providing full and open competitionconsistent with the standards of this section and ? 200.320.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effectiveinternal control over the Federal award that provides reasonable assurance that the non-federal entityis managing the federal award in compliance with federal statutes, regulations, and the terms andconditions of the federal award. These internal controls should comply with the guidance in "Standardsfor Internal Control in the Federal Government" issued by the Comptroller General of the United Statesor the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizationsof the Treadway Commission (COSO).Condition/Context:Per its approved Procurement Policy, the Board is required to obtain 2 quotes for purchases between$15,000 and $50,000. We noted 4 out of 8 samples where only 1 quote was obtained for purchaseswithin the thresholds noted above.Questioned Costs:None noted.Cause:The Board did not retain documentation as to why the Procurement Policy was not followed.Effect: The Board could be circumventing the Procurement Policy.Recommendation:We recommend that the Board ensures that documentation of Procurement's decisions on anypurchases that are excluded from the requirements noted in the Procurement Policy are retained foraudit purposes.Views of responsible officials:Management agrees with the finding.
Finding Number: 2022-002Prior Year Finding: NoFederal Agency: U.S. Department of EducationFederal Program: Special Education ClusterAssistance Listing: 84.027, 84.173Pass-Through Entity: Maryland State Department of EducationPass-Through AwardNumber and Period:211021-03 (10/1/20 ? 9/30/22)220391-02 (7/1/21 ? 9/30/23)221324-01 (7/1/21 ? 9/30/23)Compliance Requirement: ProcurementType of Finding Significant Deficiency in Internal Control over Compliance,Other MattersCriteria or Specific Requirement:Compliance: Per 2 CFR section 200.318, a non-Federal entity must have and use documentedprocurement procedures, consistent with State, local, and tribal laws and regulations and the standardsof this section, for the acquisition of property or services required under a Federal award or subaward.Per 2 CFR section 200.319, all procurement transactions for the acquisition of property or servicesrequired under a Federal award must be conducted in a manner providing full and open competitionconsistent with the standards of this section and ? 200.320.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effectiveinternal control over the Federal award that provides reasonable assurance that the non-federal entityis managing the federal award in compliance with federal statutes, regulations, and the terms andconditions of the federal award. These internal controls should comply with the guidance in "Standardsfor Internal Control in the Federal Government" issued by the Comptroller General of the United Statesor the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizationsof the Treadway Commission (COSO).Condition/Context:Per its approved Procurement Policy, the Board is required to obtain 2 quotes for purchases between$15,000 and $50,000. We noted 4 out of 8 samples where only 1 quote was obtained for purchaseswithin the thresholds noted above.Questioned Costs:None noted.Cause:The Board did not retain documentation as to why the Procurement Policy was not followed.Effect: The Board could be circumventing the Procurement Policy.Recommendation:We recommend that the Board ensures that documentation of Procurement's decisions on anypurchases that are excluded from the requirements noted in the Procurement Policy are retained foraudit purposes.Views of responsible officials:Management agrees with the finding.
Finding Number: 2022-002Prior Year Finding: NoFederal Agency: U.S. Department of EducationFederal Program: Special Education ClusterAssistance Listing: 84.027, 84.173Pass-Through Entity: Maryland State Department of EducationPass-Through AwardNumber and Period:211021-03 (10/1/20 ? 9/30/22)220391-02 (7/1/21 ? 9/30/23)221324-01 (7/1/21 ? 9/30/23)Compliance Requirement: ProcurementType of Finding Significant Deficiency in Internal Control over Compliance,Other MattersCriteria or Specific Requirement:Compliance: Per 2 CFR section 200.318, a non-Federal entity must have and use documentedprocurement procedures, consistent with State, local, and tribal laws and regulations and the standardsof this section, for the acquisition of property or services required under a Federal award or subaward.Per 2 CFR section 200.319, all procurement transactions for the acquisition of property or servicesrequired under a Federal award must be conducted in a manner providing full and open competitionconsistent with the standards of this section and ? 200.320.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effectiveinternal control over the Federal award that provides reasonable assurance that the non-federal entityis managing the federal award in compliance with federal statutes, regulations, and the terms andconditions of the federal award. These internal controls should comply with the guidance in "Standardsfor Internal Control in the Federal Government" issued by the Comptroller General of the United Statesor the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizationsof the Treadway Commission (COSO).Condition/Context:Per its approved Procurement Policy, the Board is required to obtain 2 quotes for purchases between$15,000 and $50,000. We noted 4 out of 8 samples where only 1 quote was obtained for purchaseswithin the thresholds noted above.Questioned Costs:None noted.Cause:The Board did not retain documentation as to why the Procurement Policy was not followed.Effect: The Board could be circumventing the Procurement Policy.Recommendation:We recommend that the Board ensures that documentation of Procurement's decisions on anypurchases that are excluded from the requirements noted in the Procurement Policy are retained foraudit purposes.Views of responsible officials:Management agrees with the finding.
Finding Number: 2022-002Prior Year Finding: NoFederal Agency: U.S. Department of EducationFederal Program: Special Education ClusterAssistance Listing: 84.027, 84.173Pass-Through Entity: Maryland State Department of EducationPass-Through AwardNumber and Period:211021-03 (10/1/20 ? 9/30/22)220391-02 (7/1/21 ? 9/30/23)221324-01 (7/1/21 ? 9/30/23)Compliance Requirement: ProcurementType of Finding Significant Deficiency in Internal Control over Compliance,Other MattersCriteria or Specific Requirement:Compliance: Per 2 CFR section 200.318, a non-Federal entity must have and use documentedprocurement procedures, consistent with State, local, and tribal laws and regulations and the standardsof this section, for the acquisition of property or services required under a Federal award or subaward.Per 2 CFR section 200.319, all procurement transactions for the acquisition of property or servicesrequired under a Federal award must be conducted in a manner providing full and open competitionconsistent with the standards of this section and ? 200.320.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effectiveinternal control over the Federal award that provides reasonable assurance that the non-federal entityis managing the federal award in compliance with federal statutes, regulations, and the terms andconditions of the federal award. These internal controls should comply with the guidance in "Standardsfor Internal Control in the Federal Government" issued by the Comptroller General of the United Statesor the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizationsof the Treadway Commission (COSO).Condition/Context:Per its approved Procurement Policy, the Board is required to obtain 2 quotes for purchases between$15,000 and $50,000. We noted 4 out of 8 samples where only 1 quote was obtained for purchaseswithin the thresholds noted above.Questioned Costs:None noted.Cause:The Board did not retain documentation as to why the Procurement Policy was not followed.Effect: The Board could be circumventing the Procurement Policy.Recommendation:We recommend that the Board ensures that documentation of Procurement's decisions on anypurchases that are excluded from the requirements noted in the Procurement Policy are retained foraudit purposes.Views of responsible officials:Management agrees with the finding.
Finding Number: 2022-002Prior Year Finding: NoFederal Agency: U.S. Department of EducationFederal Program: Special Education ClusterAssistance Listing: 84.027, 84.173Pass-Through Entity: Maryland State Department of EducationPass-Through AwardNumber and Period:211021-03 (10/1/20 ? 9/30/22)220391-02 (7/1/21 ? 9/30/23)221324-01 (7/1/21 ? 9/30/23)Compliance Requirement: ProcurementType of Finding Significant Deficiency in Internal Control over Compliance,Other MattersCriteria or Specific Requirement:Compliance: Per 2 CFR section 200.318, a non-Federal entity must have and use documentedprocurement procedures, consistent with State, local, and tribal laws and regulations and the standardsof this section, for the acquisition of property or services required under a Federal award or subaward.Per 2 CFR section 200.319, all procurement transactions for the acquisition of property or servicesrequired under a Federal award must be conducted in a manner providing full and open competitionconsistent with the standards of this section and ? 200.320.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effectiveinternal control over the Federal award that provides reasonable assurance that the non-federal entityis managing the federal award in compliance with federal statutes, regulations, and the terms andconditions of the federal award. These internal controls should comply with the guidance in "Standardsfor Internal Control in the Federal Government" issued by the Comptroller General of the United Statesor the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizationsof the Treadway Commission (COSO).Condition/Context:Per its approved Procurement Policy, the Board is required to obtain 2 quotes for purchases between$15,000 and $50,000. We noted 4 out of 8 samples where only 1 quote was obtained for purchaseswithin the thresholds noted above.Questioned Costs:None noted.Cause:The Board did not retain documentation as to why the Procurement Policy was not followed.Effect: The Board could be circumventing the Procurement Policy.Recommendation:We recommend that the Board ensures that documentation of Procurement's decisions on anypurchases that are excluded from the requirements noted in the Procurement Policy are retained foraudit purposes.Views of responsible officials:Management agrees with the finding.
Finding Number: 2022-002Prior Year Finding: NoFederal Agency: U.S. Department of EducationFederal Program: Special Education ClusterAssistance Listing: 84.027, 84.173Pass-Through Entity: Maryland State Department of EducationPass-Through AwardNumber and Period:211021-03 (10/1/20 ? 9/30/22)220391-02 (7/1/21 ? 9/30/23)221324-01 (7/1/21 ? 9/30/23)Compliance Requirement: ProcurementType of Finding Significant Deficiency in Internal Control over Compliance,Other MattersCriteria or Specific Requirement:Compliance: Per 2 CFR section 200.318, a non-Federal entity must have and use documentedprocurement procedures, consistent with State, local, and tribal laws and regulations and the standardsof this section, for the acquisition of property or services required under a Federal award or subaward.Per 2 CFR section 200.319, all procurement transactions for the acquisition of property or servicesrequired under a Federal award must be conducted in a manner providing full and open competitionconsistent with the standards of this section and ? 200.320.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effectiveinternal control over the Federal award that provides reasonable assurance that the non-federal entityis managing the federal award in compliance with federal statutes, regulations, and the terms andconditions of the federal award. These internal controls should comply with the guidance in "Standardsfor Internal Control in the Federal Government" issued by the Comptroller General of the United Statesor the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizationsof the Treadway Commission (COSO).Condition/Context:Per its approved Procurement Policy, the Board is required to obtain 2 quotes for purchases between$15,000 and $50,000. We noted 4 out of 8 samples where only 1 quote was obtained for purchaseswithin the thresholds noted above.Questioned Costs:None noted.Cause:The Board did not retain documentation as to why the Procurement Policy was not followed.Effect: The Board could be circumventing the Procurement Policy.Recommendation:We recommend that the Board ensures that documentation of Procurement's decisions on anypurchases that are excluded from the requirements noted in the Procurement Policy are retained foraudit purposes.Views of responsible officials:Management agrees with the finding.
Finding Number: 2022-002Prior Year Finding: NoFederal Agency: U.S. Department of EducationFederal Program: Special Education ClusterAssistance Listing: 84.027, 84.173Pass-Through Entity: Maryland State Department of EducationPass-Through AwardNumber and Period:211021-03 (10/1/20 ? 9/30/22)220391-02 (7/1/21 ? 9/30/23)221324-01 (7/1/21 ? 9/30/23)Compliance Requirement: ProcurementType of Finding Significant Deficiency in Internal Control over Compliance,Other MattersCriteria or Specific Requirement:Compliance: Per 2 CFR section 200.318, a non-Federal entity must have and use documentedprocurement procedures, consistent with State, local, and tribal laws and regulations and the standardsof this section, for the acquisition of property or services required under a Federal award or subaward.Per 2 CFR section 200.319, all procurement transactions for the acquisition of property or servicesrequired under a Federal award must be conducted in a manner providing full and open competitionconsistent with the standards of this section and ? 200.320.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effectiveinternal control over the Federal award that provides reasonable assurance that the non-federal entityis managing the federal award in compliance with federal statutes, regulations, and the terms andconditions of the federal award. These internal controls should comply with the guidance in "Standardsfor Internal Control in the Federal Government" issued by the Comptroller General of the United Statesor the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizationsof the Treadway Commission (COSO).Condition/Context:Per its approved Procurement Policy, the Board is required to obtain 2 quotes for purchases between$15,000 and $50,000. We noted 4 out of 8 samples where only 1 quote was obtained for purchaseswithin the thresholds noted above.Questioned Costs:None noted.Cause:The Board did not retain documentation as to why the Procurement Policy was not followed.Effect: The Board could be circumventing the Procurement Policy.Recommendation:We recommend that the Board ensures that documentation of Procurement's decisions on anypurchases that are excluded from the requirements noted in the Procurement Policy are retained foraudit purposes.Views of responsible officials:Management agrees with the finding.
Finding Number: 2022-002Prior Year Finding: NoFederal Agency: U.S. Department of EducationFederal Program: Special Education ClusterAssistance Listing: 84.027, 84.173Pass-Through Entity: Maryland State Department of EducationPass-Through AwardNumber and Period:211021-03 (10/1/20 ? 9/30/22)220391-02 (7/1/21 ? 9/30/23)221324-01 (7/1/21 ? 9/30/23)Compliance Requirement: ProcurementType of Finding Significant Deficiency in Internal Control over Compliance,Other MattersCriteria or Specific Requirement:Compliance: Per 2 CFR section 200.318, a non-Federal entity must have and use documentedprocurement procedures, consistent with State, local, and tribal laws and regulations and the standardsof this section, for the acquisition of property or services required under a Federal award or subaward.Per 2 CFR section 200.319, all procurement transactions for the acquisition of property or servicesrequired under a Federal award must be conducted in a manner providing full and open competitionconsistent with the standards of this section and ? 200.320.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effectiveinternal control over the Federal award that provides reasonable assurance that the non-federal entityis managing the federal award in compliance with federal statutes, regulations, and the terms andconditions of the federal award. These internal controls should comply with the guidance in "Standardsfor Internal Control in the Federal Government" issued by the Comptroller General of the United Statesor the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizationsof the Treadway Commission (COSO).Condition/Context:Per its approved Procurement Policy, the Board is required to obtain 2 quotes for purchases between$15,000 and $50,000. We noted 4 out of 8 samples where only 1 quote was obtained for purchaseswithin the thresholds noted above.Questioned Costs:None noted.Cause:The Board did not retain documentation as to why the Procurement Policy was not followed.Effect: The Board could be circumventing the Procurement Policy.Recommendation:We recommend that the Board ensures that documentation of Procurement's decisions on anypurchases that are excluded from the requirements noted in the Procurement Policy are retained foraudit purposes.Views of responsible officials:Management agrees with the finding.
Finding Number: 2022-002Prior Year Finding: NoFederal Agency: U.S. Department of EducationFederal Program: Special Education ClusterAssistance Listing: 84.027, 84.173Pass-Through Entity: Maryland State Department of EducationPass-Through AwardNumber and Period:211021-03 (10/1/20 ? 9/30/22)220391-02 (7/1/21 ? 9/30/23)221324-01 (7/1/21 ? 9/30/23)Compliance Requirement: ProcurementType of Finding Significant Deficiency in Internal Control over Compliance,Other MattersCriteria or Specific Requirement:Compliance: Per 2 CFR section 200.318, a non-Federal entity must have and use documentedprocurement procedures, consistent with State, local, and tribal laws and regulations and the standardsof this section, for the acquisition of property or services required under a Federal award or subaward.Per 2 CFR section 200.319, all procurement transactions for the acquisition of property or servicesrequired under a Federal award must be conducted in a manner providing full and open competitionconsistent with the standards of this section and ? 200.320.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effectiveinternal control over the Federal award that provides reasonable assurance that the non-federal entityis managing the federal award in compliance with federal statutes, regulations, and the terms andconditions of the federal award. These internal controls should comply with the guidance in "Standardsfor Internal Control in the Federal Government" issued by the Comptroller General of the United Statesor the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizationsof the Treadway Commission (COSO).Condition/Context:Per its approved Procurement Policy, the Board is required to obtain 2 quotes for purchases between$15,000 and $50,000. We noted 4 out of 8 samples where only 1 quote was obtained for purchaseswithin the thresholds noted above.Questioned Costs:None noted.Cause:The Board did not retain documentation as to why the Procurement Policy was not followed.Effect: The Board could be circumventing the Procurement Policy.Recommendation:We recommend that the Board ensures that documentation of Procurement's decisions on anypurchases that are excluded from the requirements noted in the Procurement Policy are retained foraudit purposes.Views of responsible officials:Management agrees with the finding.
Finding Number: 2022-002Prior Year Finding: NoFederal Agency: U.S. Department of EducationFederal Program: Special Education ClusterAssistance Listing: 84.027, 84.173Pass-Through Entity: Maryland State Department of EducationPass-Through AwardNumber and Period:211021-03 (10/1/20 ? 9/30/22)220391-02 (7/1/21 ? 9/30/23)221324-01 (7/1/21 ? 9/30/23)Compliance Requirement: ProcurementType of Finding Significant Deficiency in Internal Control over Compliance,Other MattersCriteria or Specific Requirement:Compliance: Per 2 CFR section 200.318, a non-Federal entity must have and use documentedprocurement procedures, consistent with State, local, and tribal laws and regulations and the standardsof this section, for the acquisition of property or services required under a Federal award or subaward.Per 2 CFR section 200.319, all procurement transactions for the acquisition of property or servicesrequired under a Federal award must be conducted in a manner providing full and open competitionconsistent with the standards of this section and ? 200.320.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effectiveinternal control over the Federal award that provides reasonable assurance that the non-federal entityis managing the federal award in compliance with federal statutes, regulations, and the terms andconditions of the federal award. These internal controls should comply with the guidance in "Standardsfor Internal Control in the Federal Government" issued by the Comptroller General of the United Statesor the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizationsof the Treadway Commission (COSO).Condition/Context:Per its approved Procurement Policy, the Board is required to obtain 2 quotes for purchases between$15,000 and $50,000. We noted 4 out of 8 samples where only 1 quote was obtained for purchaseswithin the thresholds noted above.Questioned Costs:None noted.Cause:The Board did not retain documentation as to why the Procurement Policy was not followed.Effect: The Board could be circumventing the Procurement Policy.Recommendation:We recommend that the Board ensures that documentation of Procurement's decisions on anypurchases that are excluded from the requirements noted in the Procurement Policy are retained foraudit purposes.Views of responsible officials:Management agrees with the finding.
Finding Number: 2022-002Prior Year Finding: NoFederal Agency: U.S. Department of EducationFederal Program: Special Education ClusterAssistance Listing: 84.027, 84.173Pass-Through Entity: Maryland State Department of EducationPass-Through AwardNumber and Period:211021-03 (10/1/20 ? 9/30/22)220391-02 (7/1/21 ? 9/30/23)221324-01 (7/1/21 ? 9/30/23)Compliance Requirement: ProcurementType of Finding Significant Deficiency in Internal Control over Compliance,Other MattersCriteria or Specific Requirement:Compliance: Per 2 CFR section 200.318, a non-Federal entity must have and use documentedprocurement procedures, consistent with State, local, and tribal laws and regulations and the standardsof this section, for the acquisition of property or services required under a Federal award or subaward.Per 2 CFR section 200.319, all procurement transactions for the acquisition of property or servicesrequired under a Federal award must be conducted in a manner providing full and open competitionconsistent with the standards of this section and ? 200.320.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effectiveinternal control over the Federal award that provides reasonable assurance that the non-federal entityis managing the federal award in compliance with federal statutes, regulations, and the terms andconditions of the federal award. These internal controls should comply with the guidance in "Standardsfor Internal Control in the Federal Government" issued by the Comptroller General of the United Statesor the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizationsof the Treadway Commission (COSO).Condition/Context:Per its approved Procurement Policy, the Board is required to obtain 2 quotes for purchases between$15,000 and $50,000. We noted 4 out of 8 samples where only 1 quote was obtained for purchaseswithin the thresholds noted above.Questioned Costs:None noted.Cause:The Board did not retain documentation as to why the Procurement Policy was not followed.Effect: The Board could be circumventing the Procurement Policy.Recommendation:We recommend that the Board ensures that documentation of Procurement's decisions on anypurchases that are excluded from the requirements noted in the Procurement Policy are retained foraudit purposes.Views of responsible officials:Management agrees with the finding.
Finding Number: 2022-002Prior Year Finding: NoFederal Agency: U.S. Department of EducationFederal Program: Special Education ClusterAssistance Listing: 84.027, 84.173Pass-Through Entity: Maryland State Department of EducationPass-Through AwardNumber and Period:211021-03 (10/1/20 ? 9/30/22)220391-02 (7/1/21 ? 9/30/23)221324-01 (7/1/21 ? 9/30/23)Compliance Requirement: ProcurementType of Finding Significant Deficiency in Internal Control over Compliance,Other MattersCriteria or Specific Requirement:Compliance: Per 2 CFR section 200.318, a non-Federal entity must have and use documentedprocurement procedures, consistent with State, local, and tribal laws and regulations and the standardsof this section, for the acquisition of property or services required under a Federal award or subaward.Per 2 CFR section 200.319, all procurement transactions for the acquisition of property or servicesrequired under a Federal award must be conducted in a manner providing full and open competitionconsistent with the standards of this section and ? 200.320.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effectiveinternal control over the Federal award that provides reasonable assurance that the non-federal entityis managing the federal award in compliance with federal statutes, regulations, and the terms andconditions of the federal award. These internal controls should comply with the guidance in "Standardsfor Internal Control in the Federal Government" issued by the Comptroller General of the United Statesor the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizationsof the Treadway Commission (COSO).Condition/Context:Per its approved Procurement Policy, the Board is required to obtain 2 quotes for purchases between$15,000 and $50,000. We noted 4 out of 8 samples where only 1 quote was obtained for purchaseswithin the thresholds noted above.Questioned Costs:None noted.Cause:The Board did not retain documentation as to why the Procurement Policy was not followed.Effect: The Board could be circumventing the Procurement Policy.Recommendation:We recommend that the Board ensures that documentation of Procurement's decisions on anypurchases that are excluded from the requirements noted in the Procurement Policy are retained foraudit purposes.Views of responsible officials:Management agrees with the finding.
Finding Number: 2022-002Prior Year Finding: NoFederal Agency: U.S. Department of EducationFederal Program: Special Education ClusterAssistance Listing: 84.027, 84.173Pass-Through Entity: Maryland State Department of EducationPass-Through AwardNumber and Period:211021-03 (10/1/20 ? 9/30/22)220391-02 (7/1/21 ? 9/30/23)221324-01 (7/1/21 ? 9/30/23)Compliance Requirement: ProcurementType of Finding Significant Deficiency in Internal Control over Compliance,Other MattersCriteria or Specific Requirement:Compliance: Per 2 CFR section 200.318, a non-Federal entity must have and use documentedprocurement procedures, consistent with State, local, and tribal laws and regulations and the standardsof this section, for the acquisition of property or services required under a Federal award or subaward.Per 2 CFR section 200.319, all procurement transactions for the acquisition of property or servicesrequired under a Federal award must be conducted in a manner providing full and open competitionconsistent with the standards of this section and ? 200.320.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effectiveinternal control over the Federal award that provides reasonable assurance that the non-federal entityis managing the federal award in compliance with federal statutes, regulations, and the terms andconditions of the federal award. These internal controls should comply with the guidance in "Standardsfor Internal Control in the Federal Government" issued by the Comptroller General of the United Statesor the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizationsof the Treadway Commission (COSO).Condition/Context:Per its approved Procurement Policy, the Board is required to obtain 2 quotes for purchases between$15,000 and $50,000. We noted 4 out of 8 samples where only 1 quote was obtained for purchaseswithin the thresholds noted above.Questioned Costs:None noted.Cause:The Board did not retain documentation as to why the Procurement Policy was not followed.Effect: The Board could be circumventing the Procurement Policy.Recommendation:We recommend that the Board ensures that documentation of Procurement's decisions on anypurchases that are excluded from the requirements noted in the Procurement Policy are retained foraudit purposes.Views of responsible officials:Management agrees with the finding.
Finding Number: 2022-002Prior Year Finding: NoFederal Agency: U.S. Department of EducationFederal Program: Special Education ClusterAssistance Listing: 84.027, 84.173Pass-Through Entity: Maryland State Department of EducationPass-Through AwardNumber and Period:211021-03 (10/1/20 ? 9/30/22)220391-02 (7/1/21 ? 9/30/23)221324-01 (7/1/21 ? 9/30/23)Compliance Requirement: ProcurementType of Finding Significant Deficiency in Internal Control over Compliance,Other MattersCriteria or Specific Requirement:Compliance: Per 2 CFR section 200.318, a non-Federal entity must have and use documentedprocurement procedures, consistent with State, local, and tribal laws and regulations and the standardsof this section, for the acquisition of property or services required under a Federal award or subaward.Per 2 CFR section 200.319, all procurement transactions for the acquisition of property or servicesrequired under a Federal award must be conducted in a manner providing full and open competitionconsistent with the standards of this section and ? 200.320.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effectiveinternal control over the Federal award that provides reasonable assurance that the non-federal entityis managing the federal award in compliance with federal statutes, regulations, and the terms andconditions of the federal award. These internal controls should comply with the guidance in "Standardsfor Internal Control in the Federal Government" issued by the Comptroller General of the United Statesor the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizationsof the Treadway Commission (COSO).Condition/Context:Per its approved Procurement Policy, the Board is required to obtain 2 quotes for purchases between$15,000 and $50,000. We noted 4 out of 8 samples where only 1 quote was obtained for purchaseswithin the thresholds noted above.Questioned Costs:None noted.Cause:The Board did not retain documentation as to why the Procurement Policy was not followed.Effect: The Board could be circumventing the Procurement Policy.Recommendation:We recommend that the Board ensures that documentation of Procurement's decisions on anypurchases that are excluded from the requirements noted in the Procurement Policy are retained foraudit purposes.Views of responsible officials:Management agrees with the finding.
Finding Number: 2022-002Prior Year Finding: NoFederal Agency: U.S. Department of EducationFederal Program: Special Education ClusterAssistance Listing: 84.027, 84.173Pass-Through Entity: Maryland State Department of EducationPass-Through AwardNumber and Period:211021-03 (10/1/20 ? 9/30/22)220391-02 (7/1/21 ? 9/30/23)221324-01 (7/1/21 ? 9/30/23)Compliance Requirement: ProcurementType of Finding Significant Deficiency in Internal Control over Compliance,Other MattersCriteria or Specific Requirement:Compliance: Per 2 CFR section 200.318, a non-Federal entity must have and use documentedprocurement procedures, consistent with State, local, and tribal laws and regulations and the standardsof this section, for the acquisition of property or services required under a Federal award or subaward.Per 2 CFR section 200.319, all procurement transactions for the acquisition of property or servicesrequired under a Federal award must be conducted in a manner providing full and open competitionconsistent with the standards of this section and ? 200.320.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effectiveinternal control over the Federal award that provides reasonable assurance that the non-federal entityis managing the federal award in compliance with federal statutes, regulations, and the terms andconditions of the federal award. These internal controls should comply with the guidance in "Standardsfor Internal Control in the Federal Government" issued by the Comptroller General of the United Statesor the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizationsof the Treadway Commission (COSO).Condition/Context:Per its approved Procurement Policy, the Board is required to obtain 2 quotes for purchases between$15,000 and $50,000. We noted 4 out of 8 samples where only 1 quote was obtained for purchaseswithin the thresholds noted above.Questioned Costs:None noted.Cause:The Board did not retain documentation as to why the Procurement Policy was not followed.Effect: The Board could be circumventing the Procurement Policy.Recommendation:We recommend that the Board ensures that documentation of Procurement's decisions on anypurchases that are excluded from the requirements noted in the Procurement Policy are retained foraudit purposes.Views of responsible officials:Management agrees with the finding.
Finding Number: 2022-002Prior Year Finding: NoFederal Agency: U.S. Department of EducationFederal Program: Special Education ClusterAssistance Listing: 84.027, 84.173Pass-Through Entity: Maryland State Department of EducationPass-Through AwardNumber and Period:211021-03 (10/1/20 ? 9/30/22)220391-02 (7/1/21 ? 9/30/23)221324-01 (7/1/21 ? 9/30/23)Compliance Requirement: ProcurementType of Finding Significant Deficiency in Internal Control over Compliance,Other MattersCriteria or Specific Requirement:Compliance: Per 2 CFR section 200.318, a non-Federal entity must have and use documentedprocurement procedures, consistent with State, local, and tribal laws and regulations and the standardsof this section, for the acquisition of property or services required under a Federal award or subaward.Per 2 CFR section 200.319, all procurement transactions for the acquisition of property or servicesrequired under a Federal award must be conducted in a manner providing full and open competitionconsistent with the standards of this section and ? 200.320.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effectiveinternal control over the Federal award that provides reasonable assurance that the non-federal entityis managing the federal award in compliance with federal statutes, regulations, and the terms andconditions of the federal award. These internal controls should comply with the guidance in "Standardsfor Internal Control in the Federal Government" issued by the Comptroller General of the United Statesor the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizationsof the Treadway Commission (COSO).Condition/Context:Per its approved Procurement Policy, the Board is required to obtain 2 quotes for purchases between$15,000 and $50,000. We noted 4 out of 8 samples where only 1 quote was obtained for purchaseswithin the thresholds noted above.Questioned Costs:None noted.Cause:The Board did not retain documentation as to why the Procurement Policy was not followed.Effect: The Board could be circumventing the Procurement Policy.Recommendation:We recommend that the Board ensures that documentation of Procurement's decisions on anypurchases that are excluded from the requirements noted in the Procurement Policy are retained foraudit purposes.Views of responsible officials:Management agrees with the finding.
Finding Number: 2022-002Prior Year Finding: NoFederal Agency: U.S. Department of EducationFederal Program: Special Education ClusterAssistance Listing: 84.027, 84.173Pass-Through Entity: Maryland State Department of EducationPass-Through AwardNumber and Period:211021-03 (10/1/20 ? 9/30/22)220391-02 (7/1/21 ? 9/30/23)221324-01 (7/1/21 ? 9/30/23)Compliance Requirement: ProcurementType of Finding Significant Deficiency in Internal Control over Compliance,Other MattersCriteria or Specific Requirement:Compliance: Per 2 CFR section 200.318, a non-Federal entity must have and use documentedprocurement procedures, consistent with State, local, and tribal laws and regulations and the standardsof this section, for the acquisition of property or services required under a Federal award or subaward.Per 2 CFR section 200.319, all procurement transactions for the acquisition of property or servicesrequired under a Federal award must be conducted in a manner providing full and open competitionconsistent with the standards of this section and ? 200.320.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effectiveinternal control over the Federal award that provides reasonable assurance that the non-federal entityis managing the federal award in compliance with federal statutes, regulations, and the terms andconditions of the federal award. These internal controls should comply with the guidance in "Standardsfor Internal Control in the Federal Government" issued by the Comptroller General of the United Statesor the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizationsof the Treadway Commission (COSO).Condition/Context:Per its approved Procurement Policy, the Board is required to obtain 2 quotes for purchases between$15,000 and $50,000. We noted 4 out of 8 samples where only 1 quote was obtained for purchaseswithin the thresholds noted above.Questioned Costs:None noted.Cause:The Board did not retain documentation as to why the Procurement Policy was not followed.Effect: The Board could be circumventing the Procurement Policy.Recommendation:We recommend that the Board ensures that documentation of Procurement's decisions on anypurchases that are excluded from the requirements noted in the Procurement Policy are retained foraudit purposes.Views of responsible officials:Management agrees with the finding.
Finding Number: 2022-002Prior Year Finding: NoFederal Agency: U.S. Department of EducationFederal Program: Special Education ClusterAssistance Listing: 84.027, 84.173Pass-Through Entity: Maryland State Department of EducationPass-Through AwardNumber and Period:211021-03 (10/1/20 ? 9/30/22)220391-02 (7/1/21 ? 9/30/23)221324-01 (7/1/21 ? 9/30/23)Compliance Requirement: ProcurementType of Finding Significant Deficiency in Internal Control over Compliance,Other MattersCriteria or Specific Requirement:Compliance: Per 2 CFR section 200.318, a non-Federal entity must have and use documentedprocurement procedures, consistent with State, local, and tribal laws and regulations and the standardsof this section, for the acquisition of property or services required under a Federal award or subaward.Per 2 CFR section 200.319, all procurement transactions for the acquisition of property or servicesrequired under a Federal award must be conducted in a manner providing full and open competitionconsistent with the standards of this section and ? 200.320.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effectiveinternal control over the Federal award that provides reasonable assurance that the non-federal entityis managing the federal award in compliance with federal statutes, regulations, and the terms andconditions of the federal award. These internal controls should comply with the guidance in "Standardsfor Internal Control in the Federal Government" issued by the Comptroller General of the United Statesor the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizationsof the Treadway Commission (COSO).Condition/Context:Per its approved Procurement Policy, the Board is required to obtain 2 quotes for purchases between$15,000 and $50,000. We noted 4 out of 8 samples where only 1 quote was obtained for purchaseswithin the thresholds noted above.Questioned Costs:None noted.Cause:The Board did not retain documentation as to why the Procurement Policy was not followed.Effect: The Board could be circumventing the Procurement Policy.Recommendation:We recommend that the Board ensures that documentation of Procurement's decisions on anypurchases that are excluded from the requirements noted in the Procurement Policy are retained foraudit purposes.Views of responsible officials:Management agrees with the finding.
Finding Number: 2022-002Prior Year Finding: NoFederal Agency: U.S. Department of EducationFederal Program: Special Education ClusterAssistance Listing: 84.027, 84.173Pass-Through Entity: Maryland State Department of EducationPass-Through AwardNumber and Period:211021-03 (10/1/20 ? 9/30/22)220391-02 (7/1/21 ? 9/30/23)221324-01 (7/1/21 ? 9/30/23)Compliance Requirement: ProcurementType of Finding Significant Deficiency in Internal Control over Compliance,Other MattersCriteria or Specific Requirement:Compliance: Per 2 CFR section 200.318, a non-Federal entity must have and use documentedprocurement procedures, consistent with State, local, and tribal laws and regulations and the standardsof this section, for the acquisition of property or services required under a Federal award or subaward.Per 2 CFR section 200.319, all procurement transactions for the acquisition of property or servicesrequired under a Federal award must be conducted in a manner providing full and open competitionconsistent with the standards of this section and ? 200.320.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effectiveinternal control over the Federal award that provides reasonable assurance that the non-federal entityis managing the federal award in compliance with federal statutes, regulations, and the terms andconditions of the federal award. These internal controls should comply with the guidance in "Standardsfor Internal Control in the Federal Government" issued by the Comptroller General of the United Statesor the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizationsof the Treadway Commission (COSO).Condition/Context:Per its approved Procurement Policy, the Board is required to obtain 2 quotes for purchases between$15,000 and $50,000. We noted 4 out of 8 samples where only 1 quote was obtained for purchaseswithin the thresholds noted above.Questioned Costs:None noted.Cause:The Board did not retain documentation as to why the Procurement Policy was not followed.Effect: The Board could be circumventing the Procurement Policy.Recommendation:We recommend that the Board ensures that documentation of Procurement's decisions on anypurchases that are excluded from the requirements noted in the Procurement Policy are retained foraudit purposes.Views of responsible officials:Management agrees with the finding.
Finding Number: 2022-002Prior Year Finding: NoFederal Agency: U.S. Department of EducationFederal Program: Special Education ClusterAssistance Listing: 84.027, 84.173Pass-Through Entity: Maryland State Department of EducationPass-Through AwardNumber and Period:211021-03 (10/1/20 ? 9/30/22)220391-02 (7/1/21 ? 9/30/23)221324-01 (7/1/21 ? 9/30/23)Compliance Requirement: ProcurementType of Finding Significant Deficiency in Internal Control over Compliance,Other MattersCriteria or Specific Requirement:Compliance: Per 2 CFR section 200.318, a non-Federal entity must have and use documentedprocurement procedures, consistent with State, local, and tribal laws and regulations and the standardsof this section, for the acquisition of property or services required under a Federal award or subaward.Per 2 CFR section 200.319, all procurement transactions for the acquisition of property or servicesrequired under a Federal award must be conducted in a manner providing full and open competitionconsistent with the standards of this section and ? 200.320.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effectiveinternal control over the Federal award that provides reasonable assurance that the non-federal entityis managing the federal award in compliance with federal statutes, regulations, and the terms andconditions of the federal award. These internal controls should comply with the guidance in "Standardsfor Internal Control in the Federal Government" issued by the Comptroller General of the United Statesor the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizationsof the Treadway Commission (COSO).Condition/Context:Per its approved Procurement Policy, the Board is required to obtain 2 quotes for purchases between$15,000 and $50,000. We noted 4 out of 8 samples where only 1 quote was obtained for purchaseswithin the thresholds noted above.Questioned Costs:None noted.Cause:The Board did not retain documentation as to why the Procurement Policy was not followed.Effect: The Board could be circumventing the Procurement Policy.Recommendation:We recommend that the Board ensures that documentation of Procurement's decisions on anypurchases that are excluded from the requirements noted in the Procurement Policy are retained foraudit purposes.Views of responsible officials:Management agrees with the finding.
Finding Number: 2022-002Prior Year Finding: NoFederal Agency: U.S. Department of EducationFederal Program: Special Education ClusterAssistance Listing: 84.027, 84.173Pass-Through Entity: Maryland State Department of EducationPass-Through AwardNumber and Period:211021-03 (10/1/20 ? 9/30/22)220391-02 (7/1/21 ? 9/30/23)221324-01 (7/1/21 ? 9/30/23)Compliance Requirement: ProcurementType of Finding Significant Deficiency in Internal Control over Compliance,Other MattersCriteria or Specific Requirement:Compliance: Per 2 CFR section 200.318, a non-Federal entity must have and use documentedprocurement procedures, consistent with State, local, and tribal laws and regulations and the standardsof this section, for the acquisition of property or services required under a Federal award or subaward.Per 2 CFR section 200.319, all procurement transactions for the acquisition of property or servicesrequired under a Federal award must be conducted in a manner providing full and open competitionconsistent with the standards of this section and ? 200.320.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effectiveinternal control over the Federal award that provides reasonable assurance that the non-federal entityis managing the federal award in compliance with federal statutes, regulations, and the terms andconditions of the federal award. These internal controls should comply with the guidance in "Standardsfor Internal Control in the Federal Government" issued by the Comptroller General of the United Statesor the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizationsof the Treadway Commission (COSO).Condition/Context:Per its approved Procurement Policy, the Board is required to obtain 2 quotes for purchases between$15,000 and $50,000. We noted 4 out of 8 samples where only 1 quote was obtained for purchaseswithin the thresholds noted above.Questioned Costs:None noted.Cause:The Board did not retain documentation as to why the Procurement Policy was not followed.Effect: The Board could be circumventing the Procurement Policy.Recommendation:We recommend that the Board ensures that documentation of Procurement's decisions on anypurchases that are excluded from the requirements noted in the Procurement Policy are retained foraudit purposes.Views of responsible officials:Management agrees with the finding.
Finding Number: 2022-002Prior Year Finding: NoFederal Agency: U.S. Department of EducationFederal Program: Special Education ClusterAssistance Listing: 84.027, 84.173Pass-Through Entity: Maryland State Department of EducationPass-Through AwardNumber and Period:211021-03 (10/1/20 ? 9/30/22)220391-02 (7/1/21 ? 9/30/23)221324-01 (7/1/21 ? 9/30/23)Compliance Requirement: ProcurementType of Finding Significant Deficiency in Internal Control over Compliance,Other MattersCriteria or Specific Requirement:Compliance: Per 2 CFR section 200.318, a non-Federal entity must have and use documentedprocurement procedures, consistent with State, local, and tribal laws and regulations and the standardsof this section, for the acquisition of property or services required under a Federal award or subaward.Per 2 CFR section 200.319, all procurement transactions for the acquisition of property or servicesrequired under a Federal award must be conducted in a manner providing full and open competitionconsistent with the standards of this section and ? 200.320.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effectiveinternal control over the Federal award that provides reasonable assurance that the non-federal entityis managing the federal award in compliance with federal statutes, regulations, and the terms andconditions of the federal award. These internal controls should comply with the guidance in "Standardsfor Internal Control in the Federal Government" issued by the Comptroller General of the United Statesor the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizationsof the Treadway Commission (COSO).Condition/Context:Per its approved Procurement Policy, the Board is required to obtain 2 quotes for purchases between$15,000 and $50,000. We noted 4 out of 8 samples where only 1 quote was obtained for purchaseswithin the thresholds noted above.Questioned Costs:None noted.Cause:The Board did not retain documentation as to why the Procurement Policy was not followed.Effect: The Board could be circumventing the Procurement Policy.Recommendation:We recommend that the Board ensures that documentation of Procurement's decisions on anypurchases that are excluded from the requirements noted in the Procurement Policy are retained foraudit purposes.Views of responsible officials:Management agrees with the finding.
Finding Number: 2022-002Prior Year Finding: NoFederal Agency: U.S. Department of EducationFederal Program: Special Education ClusterAssistance Listing: 84.027, 84.173Pass-Through Entity: Maryland State Department of EducationPass-Through AwardNumber and Period:211021-03 (10/1/20 ? 9/30/22)220391-02 (7/1/21 ? 9/30/23)221324-01 (7/1/21 ? 9/30/23)Compliance Requirement: ProcurementType of Finding Significant Deficiency in Internal Control over Compliance,Other MattersCriteria or Specific Requirement:Compliance: Per 2 CFR section 200.318, a non-Federal entity must have and use documentedprocurement procedures, consistent with State, local, and tribal laws and regulations and the standardsof this section, for the acquisition of property or services required under a Federal award or subaward.Per 2 CFR section 200.319, all procurement transactions for the acquisition of property or servicesrequired under a Federal award must be conducted in a manner providing full and open competitionconsistent with the standards of this section and ? 200.320.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effectiveinternal control over the Federal award that provides reasonable assurance that the non-federal entityis managing the federal award in compliance with federal statutes, regulations, and the terms andconditions of the federal award. These internal controls should comply with the guidance in "Standardsfor Internal Control in the Federal Government" issued by the Comptroller General of the United Statesor the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizationsof the Treadway Commission (COSO).Condition/Context:Per its approved Procurement Policy, the Board is required to obtain 2 quotes for purchases between$15,000 and $50,000. We noted 4 out of 8 samples where only 1 quote was obtained for purchaseswithin the thresholds noted above.Questioned Costs:None noted.Cause:The Board did not retain documentation as to why the Procurement Policy was not followed.Effect: The Board could be circumventing the Procurement Policy.Recommendation:We recommend that the Board ensures that documentation of Procurement's decisions on anypurchases that are excluded from the requirements noted in the Procurement Policy are retained foraudit purposes.Views of responsible officials:Management agrees with the finding.
Finding Number: 2022-002Prior Year Finding: NoFederal Agency: U.S. Department of EducationFederal Program: Special Education ClusterAssistance Listing: 84.027, 84.173Pass-Through Entity: Maryland State Department of EducationPass-Through AwardNumber and Period:211021-03 (10/1/20 ? 9/30/22)220391-02 (7/1/21 ? 9/30/23)221324-01 (7/1/21 ? 9/30/23)Compliance Requirement: ProcurementType of Finding Significant Deficiency in Internal Control over Compliance,Other MattersCriteria or Specific Requirement:Compliance: Per 2 CFR section 200.318, a non-Federal entity must have and use documentedprocurement procedures, consistent with State, local, and tribal laws and regulations and the standardsof this section, for the acquisition of property or services required under a Federal award or subaward.Per 2 CFR section 200.319, all procurement transactions for the acquisition of property or servicesrequired under a Federal award must be conducted in a manner providing full and open competitionconsistent with the standards of this section and ? 200.320.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effectiveinternal control over the Federal award that provides reasonable assurance that the non-federal entityis managing the federal award in compliance with federal statutes, regulations, and the terms andconditions of the federal award. These internal controls should comply with the guidance in "Standardsfor Internal Control in the Federal Government" issued by the Comptroller General of the United Statesor the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizationsof the Treadway Commission (COSO).Condition/Context:Per its approved Procurement Policy, the Board is required to obtain 2 quotes for purchases between$15,000 and $50,000. We noted 4 out of 8 samples where only 1 quote was obtained for purchaseswithin the thresholds noted above.Questioned Costs:None noted.Cause:The Board did not retain documentation as to why the Procurement Policy was not followed.Effect: The Board could be circumventing the Procurement Policy.Recommendation:We recommend that the Board ensures that documentation of Procurement's decisions on anypurchases that are excluded from the requirements noted in the Procurement Policy are retained foraudit purposes.Views of responsible officials:Management agrees with the finding.
Finding Number: 2022-002Prior Year Finding: NoFederal Agency: U.S. Department of EducationFederal Program: Special Education ClusterAssistance Listing: 84.027, 84.173Pass-Through Entity: Maryland State Department of EducationPass-Through AwardNumber and Period:211021-03 (10/1/20 ? 9/30/22)220391-02 (7/1/21 ? 9/30/23)221324-01 (7/1/21 ? 9/30/23)Compliance Requirement: ProcurementType of Finding Significant Deficiency in Internal Control over Compliance,Other MattersCriteria or Specific Requirement:Compliance: Per 2 CFR section 200.318, a non-Federal entity must have and use documentedprocurement procedures, consistent with State, local, and tribal laws and regulations and the standardsof this section, for the acquisition of property or services required under a Federal award or subaward.Per 2 CFR section 200.319, all procurement transactions for the acquisition of property or servicesrequired under a Federal award must be conducted in a manner providing full and open competitionconsistent with the standards of this section and ? 200.320.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effectiveinternal control over the Federal award that provides reasonable assurance that the non-federal entityis managing the federal award in compliance with federal statutes, regulations, and the terms andconditions of the federal award. These internal controls should comply with the guidance in "Standardsfor Internal Control in the Federal Government" issued by the Comptroller General of the United Statesor the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizationsof the Treadway Commission (COSO).Condition/Context:Per its approved Procurement Policy, the Board is required to obtain 2 quotes for purchases between$15,000 and $50,000. We noted 4 out of 8 samples where only 1 quote was obtained for purchaseswithin the thresholds noted above.Questioned Costs:None noted.Cause:The Board did not retain documentation as to why the Procurement Policy was not followed.Effect: The Board could be circumventing the Procurement Policy.Recommendation:We recommend that the Board ensures that documentation of Procurement's decisions on anypurchases that are excluded from the requirements noted in the Procurement Policy are retained foraudit purposes.Views of responsible officials:Management agrees with the finding.