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.
Subject: Child Nutrition Cluster - Procurement and Suspension and DebarmentFederal Agency: Department of AgricultureFederal Programs: School Breakfast Program, COVID-19 - School Breakfast Program, National SchoolLunch Program, COVID-19 - National School Lunch Program, Summer FoodService Program, COVID-19 - Summer Food Service Program for ChildrenAssistance Listings Numbers: 10.553, 10.555, 10.559Federal Award Numbers and Years (or Other Identifying Numbers): FY21, FY22Pass-Through Entity: Indiana Department of EducationCompliance Requirement: Procurement and Suspension and DebarmentAudit Findings: Material Weakness, Other MattersRepeat FindingThis is a repeat finding for suspension and debarment from the immediately prior report. The prioraudit finding number was 2020-004.INDIANA STATE BOARD OF ACCOUNTS23BLACKFORD COUNTY SCHOOLSSCHEDULE OF FINDINGS AND QUESTIONED COSTS(Continued)Condition and ContextAn effective internal control system was not in place at the School Corporation to ensurecompliance with requirements related to the grant agreement and the Procurement and Suspension andDebarment compliance requirement.Federal regulations allow for informal procurement methods when the value of the procurement forproperty or services does not exceed the simplified acquisition threshold, which is set at $250,000.However, Indiana Code 5-22-8 has a more restrictive threshold of $150,000 or less for when small purchaseprocedures may be used. This informal process allows for methods other than the formal bid process. Theinformal process is divided between two methods based on thresholds. Micro-purchases, typically for thosepurchases $10,000 or under, and small purchase procedures for those purchases above the micropurchasethreshold, but below the simplified acquisition threshold. Micro-purchases may be awardedwithout soliciting competitive price rate quotations. If small purchase procedures are used, then price orrate quotations must be obtained from an adequate number of qualified sources.The School Corporation did not obtain price or rate quotes for six vendors tested that were lessthan the simplified acquisition threshold of $150,000 but exceeded the $10,000 micro-purchase threshold.The micro-purchase threshold may be increased, but the School Corporation did not provide documentationthat the threshold had been increased.The School Corporation engaged with an Education Service Center that was not an approvedSchool Food Authority (SFA) cooperative. Since the Education Service Center failed to meet therequirements to be an approved SFA cooperative, the obligation reverted to the School Corporation. TheSchool Corporation did not obtain price or rate quotes for purchases of milk, exceeding $10,000 from anadequate number of sources, which fell under the small purchase procedures. In addition, the SchoolCorporation did not verify the milk vendor with a contract over $25,000 was not excluded or disqualifiedfrom participation in federal award programs.The lack of internal controls and noncompliance were systemic issues throughout the audit period.Criteria2 CFR 200.303 states in part:"The non-Federal entity must:(a) Establish and maintain effective internal control over the Federal award that providesreasonable assurance that the non-Federal entity is managing the Federal award incompliance with Federal statutes, regulations, and the terms and conditions of the Federalaward. These internal controls should be in compliance with guidance in 'Standards forInternal Control in the Federal Government' issued by the Comptroller General of theUnited States or the 'Internal Control Integrated Framework', issued by the Committee ofSponsoring Organizations of the Treadway Commission (COSO). . . ."2 CFR 200.318(i) states:"The non-Federal entity must maintain records sufficient to detail the history of procurement.These records will include, but are not necessarily limited to, the following: Rationale for themethod of procurement, selection of contract type, contractor selection or rejection, and thebasis for the contract price."INDIANA STATE BOARD OF ACCOUNTS24BLACKFORD COUNTY SCHOOLSSCHEDULE OF FINDINGS AND QUESTIONED COSTS(Continued)2 CFR 200.320(b) (Uniform Guidance) states:"Procurement by small purchase procedures. Small purchase procedures are those relativelysimple and informal procurement methods for securing services, supplies, or other propertythat do not cost more than the Simplified Acquisition Threshold. If small purchase proceduresare used, price or rate quotations must be obtained from an adequate number of qualifiedsources."2 CFR 200.320 (Revised Uniform Guidance) states in part:"The non-Federal entity must have and use document procurement procedures, consistent withthe standards of this section and ?? 200.317, 200.318, and 200.319 for any of the followingmethods of procurement used for the acquisition of property or services required under aFederal award or sub-award.(a) Informal procurement methods. When the value of the procurement for property orservices under a Federal award does not exceed the Simplified Acquisition Threshold(SAT), as defined in ? 200.1, or a lower threshold established by a non-Federal entity,formal procurement methods are not required. The non-Federal entity may use informalprocurement methods to expedite the completion of its transactions and minimize theassociated administrative burden and cost. The informal methods used for procurementof property or services at or below the SAT include: . . .(2) Small purchases ?(i) Small purchase procedures. The acquisition of property or services, theaggregate dollar amount of which is higher than the micro-purchase threshold butdoes not exceed the simplified acquisition threshold. If small purchase proceduresare used, price or rate quotations must be obtained from an adequate number ofqualified sources as determined appropriate by the non-Federal entity. . . ."Indiana Code 5-22-8-3 states:"(a) This section applies only if the purchasing agent expects the purchase to be:(1) at least fifty thousand dollars ($50,000); and(2) not more than one hundred fifty thousand dollars ($150,000). . . ."CauseManagement had not established a system of internal controls that would have ensured compliancewith the grant agreement and the Procurement and Suspension and Debarment compliance requirement.EffectThe failure to establish an effective system of internal controls enabled noncompliance to go undetected.Noncompliance with the grant agreement and the Procurement and Suspension and Debarmentcompliance requirement could result in the loss of future federal funds to the School Corporation.INDIANA STATE BOARD OF ACCOUNTS25BLACKFORD COUNTY SCHOOLSSCHEDULE OF FINDINGS AND QUESTIONED COSTS(Continued)Questioned CostsThere were no questioned costs identified.RecommendationWe recommended that the School Corporation's management establish a system of internal controlsto ensure compliance and comply with the grant agreement and the Procurement and Suspension andDebarment compliance requirement.Views of Responsible OfficialsFor the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
Subject: Child Nutrition Cluster - Procurement and Suspension and DebarmentFederal Agency: Department of AgricultureFederal Programs: School Breakfast Program, COVID-19 - School Breakfast Program, National SchoolLunch Program, COVID-19 - National School Lunch Program, Summer FoodService Program, COVID-19 - Summer Food Service Program for ChildrenAssistance Listings Numbers: 10.553, 10.555, 10.559Federal Award Numbers and Years (or Other Identifying Numbers): FY21, FY22Pass-Through Entity: Indiana Department of EducationCompliance Requirement: Procurement and Suspension and DebarmentAudit Findings: Material Weakness, Other MattersRepeat FindingThis is a repeat finding for suspension and debarment from the immediately prior report. The prioraudit finding number was 2020-004.INDIANA STATE BOARD OF ACCOUNTS23BLACKFORD COUNTY SCHOOLSSCHEDULE OF FINDINGS AND QUESTIONED COSTS(Continued)Condition and ContextAn effective internal control system was not in place at the School Corporation to ensurecompliance with requirements related to the grant agreement and the Procurement and Suspension andDebarment compliance requirement.Federal regulations allow for informal procurement methods when the value of the procurement forproperty or services does not exceed the simplified acquisition threshold, which is set at $250,000.However, Indiana Code 5-22-8 has a more restrictive threshold of $150,000 or less for when small purchaseprocedures may be used. This informal process allows for methods other than the formal bid process. Theinformal process is divided between two methods based on thresholds. Micro-purchases, typically for thosepurchases $10,000 or under, and small purchase procedures for those purchases above the micropurchasethreshold, but below the simplified acquisition threshold. Micro-purchases may be awardedwithout soliciting competitive price rate quotations. If small purchase procedures are used, then price orrate quotations must be obtained from an adequate number of qualified sources.The School Corporation did not obtain price or rate quotes for six vendors tested that were lessthan the simplified acquisition threshold of $150,000 but exceeded the $10,000 micro-purchase threshold.The micro-purchase threshold may be increased, but the School Corporation did not provide documentationthat the threshold had been increased.The School Corporation engaged with an Education Service Center that was not an approvedSchool Food Authority (SFA) cooperative. Since the Education Service Center failed to meet therequirements to be an approved SFA cooperative, the obligation reverted to the School Corporation. TheSchool Corporation did not obtain price or rate quotes for purchases of milk, exceeding $10,000 from anadequate number of sources, which fell under the small purchase procedures. In addition, the SchoolCorporation did not verify the milk vendor with a contract over $25,000 was not excluded or disqualifiedfrom participation in federal award programs.The lack of internal controls and noncompliance were systemic issues throughout the audit period.Criteria2 CFR 200.303 states in part:"The non-Federal entity must:(a) Establish and maintain effective internal control over the Federal award that providesreasonable assurance that the non-Federal entity is managing the Federal award incompliance with Federal statutes, regulations, and the terms and conditions of the Federalaward. These internal controls should be in compliance with guidance in 'Standards forInternal Control in the Federal Government' issued by the Comptroller General of theUnited States or the 'Internal Control Integrated Framework', issued by the Committee ofSponsoring Organizations of the Treadway Commission (COSO). . . ."2 CFR 200.318(i) states:"The non-Federal entity must maintain records sufficient to detail the history of procurement.These records will include, but are not necessarily limited to, the following: Rationale for themethod of procurement, selection of contract type, contractor selection or rejection, and thebasis for the contract price."INDIANA STATE BOARD OF ACCOUNTS24BLACKFORD COUNTY SCHOOLSSCHEDULE OF FINDINGS AND QUESTIONED COSTS(Continued)2 CFR 200.320(b) (Uniform Guidance) states:"Procurement by small purchase procedures. Small purchase procedures are those relativelysimple and informal procurement methods for securing services, supplies, or other propertythat do not cost more than the Simplified Acquisition Threshold. If small purchase proceduresare used, price or rate quotations must be obtained from an adequate number of qualifiedsources."2 CFR 200.320 (Revised Uniform Guidance) states in part:"The non-Federal entity must have and use document procurement procedures, consistent withthe standards of this section and ?? 200.317, 200.318, and 200.319 for any of the followingmethods of procurement used for the acquisition of property or services required under aFederal award or sub-award.(a) Informal procurement methods. When the value of the procurement for property orservices under a Federal award does not exceed the Simplified Acquisition Threshold(SAT), as defined in ? 200.1, or a lower threshold established by a non-Federal entity,formal procurement methods are not required. The non-Federal entity may use informalprocurement methods to expedite the completion of its transactions and minimize theassociated administrative burden and cost. The informal methods used for procurementof property or services at or below the SAT include: . . .(2) Small purchases ?(i) Small purchase procedures. The acquisition of property or services, theaggregate dollar amount of which is higher than the micro-purchase threshold butdoes not exceed the simplified acquisition threshold. If small purchase proceduresare used, price or rate quotations must be obtained from an adequate number ofqualified sources as determined appropriate by the non-Federal entity. . . ."Indiana Code 5-22-8-3 states:"(a) This section applies only if the purchasing agent expects the purchase to be:(1) at least fifty thousand dollars ($50,000); and(2) not more than one hundred fifty thousand dollars ($150,000). . . ."CauseManagement had not established a system of internal controls that would have ensured compliancewith the grant agreement and the Procurement and Suspension and Debarment compliance requirement.EffectThe failure to establish an effective system of internal controls enabled noncompliance to go undetected.Noncompliance with the grant agreement and the Procurement and Suspension and Debarmentcompliance requirement could result in the loss of future federal funds to the School Corporation.INDIANA STATE BOARD OF ACCOUNTS25BLACKFORD COUNTY SCHOOLSSCHEDULE OF FINDINGS AND QUESTIONED COSTS(Continued)Questioned CostsThere were no questioned costs identified.RecommendationWe recommended that the School Corporation's management establish a system of internal controlsto ensure compliance and comply with the grant agreement and the Procurement and Suspension andDebarment compliance requirement.Views of Responsible OfficialsFor the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
Subject: Child Nutrition Cluster - Procurement and Suspension and DebarmentFederal Agency: Department of AgricultureFederal Programs: School Breakfast Program, COVID-19 - School Breakfast Program, National SchoolLunch Program, COVID-19 - National School Lunch Program, Summer FoodService Program, COVID-19 - Summer Food Service Program for ChildrenAssistance Listings Numbers: 10.553, 10.555, 10.559Federal Award Numbers and Years (or Other Identifying Numbers): FY21, FY22Pass-Through Entity: Indiana Department of EducationCompliance Requirement: Procurement and Suspension and DebarmentAudit Findings: Material Weakness, Other MattersRepeat FindingThis is a repeat finding for suspension and debarment from the immediately prior report. The prioraudit finding number was 2020-004.INDIANA STATE BOARD OF ACCOUNTS23BLACKFORD COUNTY SCHOOLSSCHEDULE OF FINDINGS AND QUESTIONED COSTS(Continued)Condition and ContextAn effective internal control system was not in place at the School Corporation to ensurecompliance with requirements related to the grant agreement and the Procurement and Suspension andDebarment compliance requirement.Federal regulations allow for informal procurement methods when the value of the procurement forproperty or services does not exceed the simplified acquisition threshold, which is set at $250,000.However, Indiana Code 5-22-8 has a more restrictive threshold of $150,000 or less for when small purchaseprocedures may be used. This informal process allows for methods other than the formal bid process. Theinformal process is divided between two methods based on thresholds. Micro-purchases, typically for thosepurchases $10,000 or under, and small purchase procedures for those purchases above the micropurchasethreshold, but below the simplified acquisition threshold. Micro-purchases may be awardedwithout soliciting competitive price rate quotations. If small purchase procedures are used, then price orrate quotations must be obtained from an adequate number of qualified sources.The School Corporation did not obtain price or rate quotes for six vendors tested that were lessthan the simplified acquisition threshold of $150,000 but exceeded the $10,000 micro-purchase threshold.The micro-purchase threshold may be increased, but the School Corporation did not provide documentationthat the threshold had been increased.The School Corporation engaged with an Education Service Center that was not an approvedSchool Food Authority (SFA) cooperative. Since the Education Service Center failed to meet therequirements to be an approved SFA cooperative, the obligation reverted to the School Corporation. TheSchool Corporation did not obtain price or rate quotes for purchases of milk, exceeding $10,000 from anadequate number of sources, which fell under the small purchase procedures. In addition, the SchoolCorporation did not verify the milk vendor with a contract over $25,000 was not excluded or disqualifiedfrom participation in federal award programs.The lack of internal controls and noncompliance were systemic issues throughout the audit period.Criteria2 CFR 200.303 states in part:"The non-Federal entity must:(a) Establish and maintain effective internal control over the Federal award that providesreasonable assurance that the non-Federal entity is managing the Federal award incompliance with Federal statutes, regulations, and the terms and conditions of the Federalaward. These internal controls should be in compliance with guidance in 'Standards forInternal Control in the Federal Government' issued by the Comptroller General of theUnited States or the 'Internal Control Integrated Framework', issued by the Committee ofSponsoring Organizations of the Treadway Commission (COSO). . . ."2 CFR 200.318(i) states:"The non-Federal entity must maintain records sufficient to detail the history of procurement.These records will include, but are not necessarily limited to, the following: Rationale for themethod of procurement, selection of contract type, contractor selection or rejection, and thebasis for the contract price."INDIANA STATE BOARD OF ACCOUNTS24BLACKFORD COUNTY SCHOOLSSCHEDULE OF FINDINGS AND QUESTIONED COSTS(Continued)2 CFR 200.320(b) (Uniform Guidance) states:"Procurement by small purchase procedures. Small purchase procedures are those relativelysimple and informal procurement methods for securing services, supplies, or other propertythat do not cost more than the Simplified Acquisition Threshold. If small purchase proceduresare used, price or rate quotations must be obtained from an adequate number of qualifiedsources."2 CFR 200.320 (Revised Uniform Guidance) states in part:"The non-Federal entity must have and use document procurement procedures, consistent withthe standards of this section and ?? 200.317, 200.318, and 200.319 for any of the followingmethods of procurement used for the acquisition of property or services required under aFederal award or sub-award.(a) Informal procurement methods. When the value of the procurement for property orservices under a Federal award does not exceed the Simplified Acquisition Threshold(SAT), as defined in ? 200.1, or a lower threshold established by a non-Federal entity,formal procurement methods are not required. The non-Federal entity may use informalprocurement methods to expedite the completion of its transactions and minimize theassociated administrative burden and cost. The informal methods used for procurementof property or services at or below the SAT include: . . .(2) Small purchases ?(i) Small purchase procedures. The acquisition of property or services, theaggregate dollar amount of which is higher than the micro-purchase threshold butdoes not exceed the simplified acquisition threshold. If small purchase proceduresare used, price or rate quotations must be obtained from an adequate number ofqualified sources as determined appropriate by the non-Federal entity. . . ."Indiana Code 5-22-8-3 states:"(a) This section applies only if the purchasing agent expects the purchase to be:(1) at least fifty thousand dollars ($50,000); and(2) not more than one hundred fifty thousand dollars ($150,000). . . ."CauseManagement had not established a system of internal controls that would have ensured compliancewith the grant agreement and the Procurement and Suspension and Debarment compliance requirement.EffectThe failure to establish an effective system of internal controls enabled noncompliance to go undetected.Noncompliance with the grant agreement and the Procurement and Suspension and Debarmentcompliance requirement could result in the loss of future federal funds to the School Corporation.INDIANA STATE BOARD OF ACCOUNTS25BLACKFORD COUNTY SCHOOLSSCHEDULE OF FINDINGS AND QUESTIONED COSTS(Continued)Questioned CostsThere were no questioned costs identified.RecommendationWe recommended that the School Corporation's management establish a system of internal controlsto ensure compliance and comply with the grant agreement and the Procurement and Suspension andDebarment compliance requirement.Views of Responsible OfficialsFor the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
Subject: Child Nutrition Cluster - Procurement and Suspension and DebarmentFederal Agency: Department of AgricultureFederal Programs: School Breakfast Program, COVID-19 - School Breakfast Program, National SchoolLunch Program, COVID-19 - National School Lunch Program, Summer FoodService Program, COVID-19 - Summer Food Service Program for ChildrenAssistance Listings Numbers: 10.553, 10.555, 10.559Federal Award Numbers and Years (or Other Identifying Numbers): FY21, FY22Pass-Through Entity: Indiana Department of EducationCompliance Requirement: Procurement and Suspension and DebarmentAudit Findings: Material Weakness, Other MattersRepeat FindingThis is a repeat finding for suspension and debarment from the immediately prior report. The prioraudit finding number was 2020-004.INDIANA STATE BOARD OF ACCOUNTS23BLACKFORD COUNTY SCHOOLSSCHEDULE OF FINDINGS AND QUESTIONED COSTS(Continued)Condition and ContextAn effective internal control system was not in place at the School Corporation to ensurecompliance with requirements related to the grant agreement and the Procurement and Suspension andDebarment compliance requirement.Federal regulations allow for informal procurement methods when the value of the procurement forproperty or services does not exceed the simplified acquisition threshold, which is set at $250,000.However, Indiana Code 5-22-8 has a more restrictive threshold of $150,000 or less for when small purchaseprocedures may be used. This informal process allows for methods other than the formal bid process. Theinformal process is divided between two methods based on thresholds. Micro-purchases, typically for thosepurchases $10,000 or under, and small purchase procedures for those purchases above the micropurchasethreshold, but below the simplified acquisition threshold. Micro-purchases may be awardedwithout soliciting competitive price rate quotations. If small purchase procedures are used, then price orrate quotations must be obtained from an adequate number of qualified sources.The School Corporation did not obtain price or rate quotes for six vendors tested that were lessthan the simplified acquisition threshold of $150,000 but exceeded the $10,000 micro-purchase threshold.The micro-purchase threshold may be increased, but the School Corporation did not provide documentationthat the threshold had been increased.The School Corporation engaged with an Education Service Center that was not an approvedSchool Food Authority (SFA) cooperative. Since the Education Service Center failed to meet therequirements to be an approved SFA cooperative, the obligation reverted to the School Corporation. TheSchool Corporation did not obtain price or rate quotes for purchases of milk, exceeding $10,000 from anadequate number of sources, which fell under the small purchase procedures. In addition, the SchoolCorporation did not verify the milk vendor with a contract over $25,000 was not excluded or disqualifiedfrom participation in federal award programs.The lack of internal controls and noncompliance were systemic issues throughout the audit period.Criteria2 CFR 200.303 states in part:"The non-Federal entity must:(a) Establish and maintain effective internal control over the Federal award that providesreasonable assurance that the non-Federal entity is managing the Federal award incompliance with Federal statutes, regulations, and the terms and conditions of the Federalaward. These internal controls should be in compliance with guidance in 'Standards forInternal Control in the Federal Government' issued by the Comptroller General of theUnited States or the 'Internal Control Integrated Framework', issued by the Committee ofSponsoring Organizations of the Treadway Commission (COSO). . . ."2 CFR 200.318(i) states:"The non-Federal entity must maintain records sufficient to detail the history of procurement.These records will include, but are not necessarily limited to, the following: Rationale for themethod of procurement, selection of contract type, contractor selection or rejection, and thebasis for the contract price."INDIANA STATE BOARD OF ACCOUNTS24BLACKFORD COUNTY SCHOOLSSCHEDULE OF FINDINGS AND QUESTIONED COSTS(Continued)2 CFR 200.320(b) (Uniform Guidance) states:"Procurement by small purchase procedures. Small purchase procedures are those relativelysimple and informal procurement methods for securing services, supplies, or other propertythat do not cost more than the Simplified Acquisition Threshold. If small purchase proceduresare used, price or rate quotations must be obtained from an adequate number of qualifiedsources."2 CFR 200.320 (Revised Uniform Guidance) states in part:"The non-Federal entity must have and use document procurement procedures, consistent withthe standards of this section and ?? 200.317, 200.318, and 200.319 for any of the followingmethods of procurement used for the acquisition of property or services required under aFederal award or sub-award.(a) Informal procurement methods. When the value of the procurement for property orservices under a Federal award does not exceed the Simplified Acquisition Threshold(SAT), as defined in ? 200.1, or a lower threshold established by a non-Federal entity,formal procurement methods are not required. The non-Federal entity may use informalprocurement methods to expedite the completion of its transactions and minimize theassociated administrative burden and cost. The informal methods used for procurementof property or services at or below the SAT include: . . .(2) Small purchases ?(i) Small purchase procedures. The acquisition of property or services, theaggregate dollar amount of which is higher than the micro-purchase threshold butdoes not exceed the simplified acquisition threshold. If small purchase proceduresare used, price or rate quotations must be obtained from an adequate number ofqualified sources as determined appropriate by the non-Federal entity. . . ."Indiana Code 5-22-8-3 states:"(a) This section applies only if the purchasing agent expects the purchase to be:(1) at least fifty thousand dollars ($50,000); and(2) not more than one hundred fifty thousand dollars ($150,000). . . ."CauseManagement had not established a system of internal controls that would have ensured compliancewith the grant agreement and the Procurement and Suspension and Debarment compliance requirement.EffectThe failure to establish an effective system of internal controls enabled noncompliance to go undetected.Noncompliance with the grant agreement and the Procurement and Suspension and Debarmentcompliance requirement could result in the loss of future federal funds to the School Corporation.INDIANA STATE BOARD OF ACCOUNTS25BLACKFORD COUNTY SCHOOLSSCHEDULE OF FINDINGS AND QUESTIONED COSTS(Continued)Questioned CostsThere were no questioned costs identified.RecommendationWe recommended that the School Corporation's management establish a system of internal controlsto ensure compliance and comply with the grant agreement and the Procurement and Suspension andDebarment compliance requirement.Views of Responsible OfficialsFor the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
Subject: Child Nutrition Cluster - Procurement and Suspension and DebarmentFederal Agency: Department of AgricultureFederal Programs: School Breakfast Program, COVID-19 - School Breakfast Program, National SchoolLunch Program, COVID-19 - National School Lunch Program, Summer FoodService Program, COVID-19 - Summer Food Service Program for ChildrenAssistance Listings Numbers: 10.553, 10.555, 10.559Federal Award Numbers and Years (or Other Identifying Numbers): FY21, FY22Pass-Through Entity: Indiana Department of EducationCompliance Requirement: Procurement and Suspension and DebarmentAudit Findings: Material Weakness, Other MattersRepeat FindingThis is a repeat finding for suspension and debarment from the immediately prior report. The prioraudit finding number was 2020-004.INDIANA STATE BOARD OF ACCOUNTS23BLACKFORD COUNTY SCHOOLSSCHEDULE OF FINDINGS AND QUESTIONED COSTS(Continued)Condition and ContextAn effective internal control system was not in place at the School Corporation to ensurecompliance with requirements related to the grant agreement and the Procurement and Suspension andDebarment compliance requirement.Federal regulations allow for informal procurement methods when the value of the procurement forproperty or services does not exceed the simplified acquisition threshold, which is set at $250,000.However, Indiana Code 5-22-8 has a more restrictive threshold of $150,000 or less for when small purchaseprocedures may be used. This informal process allows for methods other than the formal bid process. Theinformal process is divided between two methods based on thresholds. Micro-purchases, typically for thosepurchases $10,000 or under, and small purchase procedures for those purchases above the micropurchasethreshold, but below the simplified acquisition threshold. Micro-purchases may be awardedwithout soliciting competitive price rate quotations. If small purchase procedures are used, then price orrate quotations must be obtained from an adequate number of qualified sources.The School Corporation did not obtain price or rate quotes for six vendors tested that were lessthan the simplified acquisition threshold of $150,000 but exceeded the $10,000 micro-purchase threshold.The micro-purchase threshold may be increased, but the School Corporation did not provide documentationthat the threshold had been increased.The School Corporation engaged with an Education Service Center that was not an approvedSchool Food Authority (SFA) cooperative. Since the Education Service Center failed to meet therequirements to be an approved SFA cooperative, the obligation reverted to the School Corporation. TheSchool Corporation did not obtain price or rate quotes for purchases of milk, exceeding $10,000 from anadequate number of sources, which fell under the small purchase procedures. In addition, the SchoolCorporation did not verify the milk vendor with a contract over $25,000 was not excluded or disqualifiedfrom participation in federal award programs.The lack of internal controls and noncompliance were systemic issues throughout the audit period.Criteria2 CFR 200.303 states in part:"The non-Federal entity must:(a) Establish and maintain effective internal control over the Federal award that providesreasonable assurance that the non-Federal entity is managing the Federal award incompliance with Federal statutes, regulations, and the terms and conditions of the Federalaward. These internal controls should be in compliance with guidance in 'Standards forInternal Control in the Federal Government' issued by the Comptroller General of theUnited States or the 'Internal Control Integrated Framework', issued by the Committee ofSponsoring Organizations of the Treadway Commission (COSO). . . ."2 CFR 200.318(i) states:"The non-Federal entity must maintain records sufficient to detail the history of procurement.These records will include, but are not necessarily limited to, the following: Rationale for themethod of procurement, selection of contract type, contractor selection or rejection, and thebasis for the contract price."INDIANA STATE BOARD OF ACCOUNTS24BLACKFORD COUNTY SCHOOLSSCHEDULE OF FINDINGS AND QUESTIONED COSTS(Continued)2 CFR 200.320(b) (Uniform Guidance) states:"Procurement by small purchase procedures. Small purchase procedures are those relativelysimple and informal procurement methods for securing services, supplies, or other propertythat do not cost more than the Simplified Acquisition Threshold. If small purchase proceduresare used, price or rate quotations must be obtained from an adequate number of qualifiedsources."2 CFR 200.320 (Revised Uniform Guidance) states in part:"The non-Federal entity must have and use document procurement procedures, consistent withthe standards of this section and ?? 200.317, 200.318, and 200.319 for any of the followingmethods of procurement used for the acquisition of property or services required under aFederal award or sub-award.(a) Informal procurement methods. When the value of the procurement for property orservices under a Federal award does not exceed the Simplified Acquisition Threshold(SAT), as defined in ? 200.1, or a lower threshold established by a non-Federal entity,formal procurement methods are not required. The non-Federal entity may use informalprocurement methods to expedite the completion of its transactions and minimize theassociated administrative burden and cost. The informal methods used for procurementof property or services at or below the SAT include: . . .(2) Small purchases ?(i) Small purchase procedures. The acquisition of property or services, theaggregate dollar amount of which is higher than the micro-purchase threshold butdoes not exceed the simplified acquisition threshold. If small purchase proceduresare used, price or rate quotations must be obtained from an adequate number ofqualified sources as determined appropriate by the non-Federal entity. . . ."Indiana Code 5-22-8-3 states:"(a) This section applies only if the purchasing agent expects the purchase to be:(1) at least fifty thousand dollars ($50,000); and(2) not more than one hundred fifty thousand dollars ($150,000). . . ."CauseManagement had not established a system of internal controls that would have ensured compliancewith the grant agreement and the Procurement and Suspension and Debarment compliance requirement.EffectThe failure to establish an effective system of internal controls enabled noncompliance to go undetected.Noncompliance with the grant agreement and the Procurement and Suspension and Debarmentcompliance requirement could result in the loss of future federal funds to the School Corporation.INDIANA STATE BOARD OF ACCOUNTS25BLACKFORD COUNTY SCHOOLSSCHEDULE OF FINDINGS AND QUESTIONED COSTS(Continued)Questioned CostsThere were no questioned costs identified.RecommendationWe recommended that the School Corporation's management establish a system of internal controlsto ensure compliance and comply with the grant agreement and the Procurement and Suspension andDebarment compliance requirement.Views of Responsible OfficialsFor the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
Subject: Child Nutrition Cluster - Procurement and Suspension and DebarmentFederal Agency: Department of AgricultureFederal Programs: School Breakfast Program, COVID-19 - School Breakfast Program, National SchoolLunch Program, COVID-19 - National School Lunch Program, Summer FoodService Program, COVID-19 - Summer Food Service Program for ChildrenAssistance Listings Numbers: 10.553, 10.555, 10.559Federal Award Numbers and Years (or Other Identifying Numbers): FY21, FY22Pass-Through Entity: Indiana Department of EducationCompliance Requirement: Procurement and Suspension and DebarmentAudit Findings: Material Weakness, Other MattersRepeat FindingThis is a repeat finding for suspension and debarment from the immediately prior report. The prioraudit finding number was 2020-004.INDIANA STATE BOARD OF ACCOUNTS23BLACKFORD COUNTY SCHOOLSSCHEDULE OF FINDINGS AND QUESTIONED COSTS(Continued)Condition and ContextAn effective internal control system was not in place at the School Corporation to ensurecompliance with requirements related to the grant agreement and the Procurement and Suspension andDebarment compliance requirement.Federal regulations allow for informal procurement methods when the value of the procurement forproperty or services does not exceed the simplified acquisition threshold, which is set at $250,000.However, Indiana Code 5-22-8 has a more restrictive threshold of $150,000 or less for when small purchaseprocedures may be used. This informal process allows for methods other than the formal bid process. Theinformal process is divided between two methods based on thresholds. Micro-purchases, typically for thosepurchases $10,000 or under, and small purchase procedures for those purchases above the micropurchasethreshold, but below the simplified acquisition threshold. Micro-purchases may be awardedwithout soliciting competitive price rate quotations. If small purchase procedures are used, then price orrate quotations must be obtained from an adequate number of qualified sources.The School Corporation did not obtain price or rate quotes for six vendors tested that were lessthan the simplified acquisition threshold of $150,000 but exceeded the $10,000 micro-purchase threshold.The micro-purchase threshold may be increased, but the School Corporation did not provide documentationthat the threshold had been increased.The School Corporation engaged with an Education Service Center that was not an approvedSchool Food Authority (SFA) cooperative. Since the Education Service Center failed to meet therequirements to be an approved SFA cooperative, the obligation reverted to the School Corporation. TheSchool Corporation did not obtain price or rate quotes for purchases of milk, exceeding $10,000 from anadequate number of sources, which fell under the small purchase procedures. In addition, the SchoolCorporation did not verify the milk vendor with a contract over $25,000 was not excluded or disqualifiedfrom participation in federal award programs.The lack of internal controls and noncompliance were systemic issues throughout the audit period.Criteria2 CFR 200.303 states in part:"The non-Federal entity must:(a) Establish and maintain effective internal control over the Federal award that providesreasonable assurance that the non-Federal entity is managing the Federal award incompliance with Federal statutes, regulations, and the terms and conditions of the Federalaward. These internal controls should be in compliance with guidance in 'Standards forInternal Control in the Federal Government' issued by the Comptroller General of theUnited States or the 'Internal Control Integrated Framework', issued by the Committee ofSponsoring Organizations of the Treadway Commission (COSO). . . ."2 CFR 200.318(i) states:"The non-Federal entity must maintain records sufficient to detail the history of procurement.These records will include, but are not necessarily limited to, the following: Rationale for themethod of procurement, selection of contract type, contractor selection or rejection, and thebasis for the contract price."INDIANA STATE BOARD OF ACCOUNTS24BLACKFORD COUNTY SCHOOLSSCHEDULE OF FINDINGS AND QUESTIONED COSTS(Continued)2 CFR 200.320(b) (Uniform Guidance) states:"Procurement by small purchase procedures. Small purchase procedures are those relativelysimple and informal procurement methods for securing services, supplies, or other propertythat do not cost more than the Simplified Acquisition Threshold. If small purchase proceduresare used, price or rate quotations must be obtained from an adequate number of qualifiedsources."2 CFR 200.320 (Revised Uniform Guidance) states in part:"The non-Federal entity must have and use document procurement procedures, consistent withthe standards of this section and ?? 200.317, 200.318, and 200.319 for any of the followingmethods of procurement used for the acquisition of property or services required under aFederal award or sub-award.(a) Informal procurement methods. When the value of the procurement for property orservices under a Federal award does not exceed the Simplified Acquisition Threshold(SAT), as defined in ? 200.1, or a lower threshold established by a non-Federal entity,formal procurement methods are not required. The non-Federal entity may use informalprocurement methods to expedite the completion of its transactions and minimize theassociated administrative burden and cost. The informal methods used for procurementof property or services at or below the SAT include: . . .(2) Small purchases ?(i) Small purchase procedures. The acquisition of property or services, theaggregate dollar amount of which is higher than the micro-purchase threshold butdoes not exceed the simplified acquisition threshold. If small purchase proceduresare used, price or rate quotations must be obtained from an adequate number ofqualified sources as determined appropriate by the non-Federal entity. . . ."Indiana Code 5-22-8-3 states:"(a) This section applies only if the purchasing agent expects the purchase to be:(1) at least fifty thousand dollars ($50,000); and(2) not more than one hundred fifty thousand dollars ($150,000). . . ."CauseManagement had not established a system of internal controls that would have ensured compliancewith the grant agreement and the Procurement and Suspension and Debarment compliance requirement.EffectThe failure to establish an effective system of internal controls enabled noncompliance to go undetected.Noncompliance with the grant agreement and the Procurement and Suspension and Debarmentcompliance requirement could result in the loss of future federal funds to the School Corporation.INDIANA STATE BOARD OF ACCOUNTS25BLACKFORD COUNTY SCHOOLSSCHEDULE OF FINDINGS AND QUESTIONED COSTS(Continued)Questioned CostsThere were no questioned costs identified.RecommendationWe recommended that the School Corporation's management establish a system of internal controlsto ensure compliance and comply with the grant agreement and the Procurement and Suspension andDebarment compliance requirement.Views of Responsible OfficialsFor the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
Subject: Child Nutrition Cluster - Procurement and Suspension and DebarmentFederal Agency: Department of AgricultureFederal Programs: School Breakfast Program, COVID-19 - School Breakfast Program, National SchoolLunch Program, COVID-19 - National School Lunch Program, Summer FoodService Program, COVID-19 - Summer Food Service Program for ChildrenAssistance Listings Numbers: 10.553, 10.555, 10.559Federal Award Numbers and Years (or Other Identifying Numbers): FY21, FY22Pass-Through Entity: Indiana Department of EducationCompliance Requirement: Procurement and Suspension and DebarmentAudit Findings: Material Weakness, Other MattersRepeat FindingThis is a repeat finding for suspension and debarment from the immediately prior report. The prioraudit finding number was 2020-004.INDIANA STATE BOARD OF ACCOUNTS23BLACKFORD COUNTY SCHOOLSSCHEDULE OF FINDINGS AND QUESTIONED COSTS(Continued)Condition and ContextAn effective internal control system was not in place at the School Corporation to ensurecompliance with requirements related to the grant agreement and the Procurement and Suspension andDebarment compliance requirement.Federal regulations allow for informal procurement methods when the value of the procurement forproperty or services does not exceed the simplified acquisition threshold, which is set at $250,000.However, Indiana Code 5-22-8 has a more restrictive threshold of $150,000 or less for when small purchaseprocedures may be used. This informal process allows for methods other than the formal bid process. Theinformal process is divided between two methods based on thresholds. Micro-purchases, typically for thosepurchases $10,000 or under, and small purchase procedures for those purchases above the micropurchasethreshold, but below the simplified acquisition threshold. Micro-purchases may be awardedwithout soliciting competitive price rate quotations. If small purchase procedures are used, then price orrate quotations must be obtained from an adequate number of qualified sources.The School Corporation did not obtain price or rate quotes for six vendors tested that were lessthan the simplified acquisition threshold of $150,000 but exceeded the $10,000 micro-purchase threshold.The micro-purchase threshold may be increased, but the School Corporation did not provide documentationthat the threshold had been increased.The School Corporation engaged with an Education Service Center that was not an approvedSchool Food Authority (SFA) cooperative. Since the Education Service Center failed to meet therequirements to be an approved SFA cooperative, the obligation reverted to the School Corporation. TheSchool Corporation did not obtain price or rate quotes for purchases of milk, exceeding $10,000 from anadequate number of sources, which fell under the small purchase procedures. In addition, the SchoolCorporation did not verify the milk vendor with a contract over $25,000 was not excluded or disqualifiedfrom participation in federal award programs.The lack of internal controls and noncompliance were systemic issues throughout the audit period.Criteria2 CFR 200.303 states in part:"The non-Federal entity must:(a) Establish and maintain effective internal control over the Federal award that providesreasonable assurance that the non-Federal entity is managing the Federal award incompliance with Federal statutes, regulations, and the terms and conditions of the Federalaward. These internal controls should be in compliance with guidance in 'Standards forInternal Control in the Federal Government' issued by the Comptroller General of theUnited States or the 'Internal Control Integrated Framework', issued by the Committee ofSponsoring Organizations of the Treadway Commission (COSO). . . ."2 CFR 200.318(i) states:"The non-Federal entity must maintain records sufficient to detail the history of procurement.These records will include, but are not necessarily limited to, the following: Rationale for themethod of procurement, selection of contract type, contractor selection or rejection, and thebasis for the contract price."INDIANA STATE BOARD OF ACCOUNTS24BLACKFORD COUNTY SCHOOLSSCHEDULE OF FINDINGS AND QUESTIONED COSTS(Continued)2 CFR 200.320(b) (Uniform Guidance) states:"Procurement by small purchase procedures. Small purchase procedures are those relativelysimple and informal procurement methods for securing services, supplies, or other propertythat do not cost more than the Simplified Acquisition Threshold. If small purchase proceduresare used, price or rate quotations must be obtained from an adequate number of qualifiedsources."2 CFR 200.320 (Revised Uniform Guidance) states in part:"The non-Federal entity must have and use document procurement procedures, consistent withthe standards of this section and ?? 200.317, 200.318, and 200.319 for any of the followingmethods of procurement used for the acquisition of property or services required under aFederal award or sub-award.(a) Informal procurement methods. When the value of the procurement for property orservices under a Federal award does not exceed the Simplified Acquisition Threshold(SAT), as defined in ? 200.1, or a lower threshold established by a non-Federal entity,formal procurement methods are not required. The non-Federal entity may use informalprocurement methods to expedite the completion of its transactions and minimize theassociated administrative burden and cost. The informal methods used for procurementof property or services at or below the SAT include: . . .(2) Small purchases ?(i) Small purchase procedures. The acquisition of property or services, theaggregate dollar amount of which is higher than the micro-purchase threshold butdoes not exceed the simplified acquisition threshold. If small purchase proceduresare used, price or rate quotations must be obtained from an adequate number ofqualified sources as determined appropriate by the non-Federal entity. . . ."Indiana Code 5-22-8-3 states:"(a) This section applies only if the purchasing agent expects the purchase to be:(1) at least fifty thousand dollars ($50,000); and(2) not more than one hundred fifty thousand dollars ($150,000). . . ."CauseManagement had not established a system of internal controls that would have ensured compliancewith the grant agreement and the Procurement and Suspension and Debarment compliance requirement.EffectThe failure to establish an effective system of internal controls enabled noncompliance to go undetected.Noncompliance with the grant agreement and the Procurement and Suspension and Debarmentcompliance requirement could result in the loss of future federal funds to the School Corporation.INDIANA STATE BOARD OF ACCOUNTS25BLACKFORD COUNTY SCHOOLSSCHEDULE OF FINDINGS AND QUESTIONED COSTS(Continued)Questioned CostsThere were no questioned costs identified.RecommendationWe recommended that the School Corporation's management establish a system of internal controlsto ensure compliance and comply with the grant agreement and the Procurement and Suspension andDebarment compliance requirement.Views of Responsible OfficialsFor the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
Subject: Child Nutrition Cluster - Procurement and Suspension and DebarmentFederal Agency: Department of AgricultureFederal Programs: School Breakfast Program, COVID-19 - School Breakfast Program, National SchoolLunch Program, COVID-19 - National School Lunch Program, Summer FoodService Program, COVID-19 - Summer Food Service Program for ChildrenAssistance Listings Numbers: 10.553, 10.555, 10.559Federal Award Numbers and Years (or Other Identifying Numbers): FY21, FY22Pass-Through Entity: Indiana Department of EducationCompliance Requirement: Procurement and Suspension and DebarmentAudit Findings: Material Weakness, Other MattersRepeat FindingThis is a repeat finding for suspension and debarment from the immediately prior report. The prioraudit finding number was 2020-004.INDIANA STATE BOARD OF ACCOUNTS23BLACKFORD COUNTY SCHOOLSSCHEDULE OF FINDINGS AND QUESTIONED COSTS(Continued)Condition and ContextAn effective internal control system was not in place at the School Corporation to ensurecompliance with requirements related to the grant agreement and the Procurement and Suspension andDebarment compliance requirement.Federal regulations allow for informal procurement methods when the value of the procurement forproperty or services does not exceed the simplified acquisition threshold, which is set at $250,000.However, Indiana Code 5-22-8 has a more restrictive threshold of $150,000 or less for when small purchaseprocedures may be used. This informal process allows for methods other than the formal bid process. Theinformal process is divided between two methods based on thresholds. Micro-purchases, typically for thosepurchases $10,000 or under, and small purchase procedures for those purchases above the micropurchasethreshold, but below the simplified acquisition threshold. Micro-purchases may be awardedwithout soliciting competitive price rate quotations. If small purchase procedures are used, then price orrate quotations must be obtained from an adequate number of qualified sources.The School Corporation did not obtain price or rate quotes for six vendors tested that were lessthan the simplified acquisition threshold of $150,000 but exceeded the $10,000 micro-purchase threshold.The micro-purchase threshold may be increased, but the School Corporation did not provide documentationthat the threshold had been increased.The School Corporation engaged with an Education Service Center that was not an approvedSchool Food Authority (SFA) cooperative. Since the Education Service Center failed to meet therequirements to be an approved SFA cooperative, the obligation reverted to the School Corporation. TheSchool Corporation did not obtain price or rate quotes for purchases of milk, exceeding $10,000 from anadequate number of sources, which fell under the small purchase procedures. In addition, the SchoolCorporation did not verify the milk vendor with a contract over $25,000 was not excluded or disqualifiedfrom participation in federal award programs.The lack of internal controls and noncompliance were systemic issues throughout the audit period.Criteria2 CFR 200.303 states in part:"The non-Federal entity must:(a) Establish and maintain effective internal control over the Federal award that providesreasonable assurance that the non-Federal entity is managing the Federal award incompliance with Federal statutes, regulations, and the terms and conditions of the Federalaward. These internal controls should be in compliance with guidance in 'Standards forInternal Control in the Federal Government' issued by the Comptroller General of theUnited States or the 'Internal Control Integrated Framework', issued by the Committee ofSponsoring Organizations of the Treadway Commission (COSO). . . ."2 CFR 200.318(i) states:"The non-Federal entity must maintain records sufficient to detail the history of procurement.These records will include, but are not necessarily limited to, the following: Rationale for themethod of procurement, selection of contract type, contractor selection or rejection, and thebasis for the contract price."INDIANA STATE BOARD OF ACCOUNTS24BLACKFORD COUNTY SCHOOLSSCHEDULE OF FINDINGS AND QUESTIONED COSTS(Continued)2 CFR 200.320(b) (Uniform Guidance) states:"Procurement by small purchase procedures. Small purchase procedures are those relativelysimple and informal procurement methods for securing services, supplies, or other propertythat do not cost more than the Simplified Acquisition Threshold. If small purchase proceduresare used, price or rate quotations must be obtained from an adequate number of qualifiedsources."2 CFR 200.320 (Revised Uniform Guidance) states in part:"The non-Federal entity must have and use document procurement procedures, consistent withthe standards of this section and ?? 200.317, 200.318, and 200.319 for any of the followingmethods of procurement used for the acquisition of property or services required under aFederal award or sub-award.(a) Informal procurement methods. When the value of the procurement for property orservices under a Federal award does not exceed the Simplified Acquisition Threshold(SAT), as defined in ? 200.1, or a lower threshold established by a non-Federal entity,formal procurement methods are not required. The non-Federal entity may use informalprocurement methods to expedite the completion of its transactions and minimize theassociated administrative burden and cost. The informal methods used for procurementof property or services at or below the SAT include: . . .(2) Small purchases ?(i) Small purchase procedures. The acquisition of property or services, theaggregate dollar amount of which is higher than the micro-purchase threshold butdoes not exceed the simplified acquisition threshold. If small purchase proceduresare used, price or rate quotations must be obtained from an adequate number ofqualified sources as determined appropriate by the non-Federal entity. . . ."Indiana Code 5-22-8-3 states:"(a) This section applies only if the purchasing agent expects the purchase to be:(1) at least fifty thousand dollars ($50,000); and(2) not more than one hundred fifty thousand dollars ($150,000). . . ."CauseManagement had not established a system of internal controls that would have ensured compliancewith the grant agreement and the Procurement and Suspension and Debarment compliance requirement.EffectThe failure to establish an effective system of internal controls enabled noncompliance to go undetected.Noncompliance with the grant agreement and the Procurement and Suspension and Debarmentcompliance requirement could result in the loss of future federal funds to the School Corporation.INDIANA STATE BOARD OF ACCOUNTS25BLACKFORD COUNTY SCHOOLSSCHEDULE OF FINDINGS AND QUESTIONED COSTS(Continued)Questioned CostsThere were no questioned costs identified.RecommendationWe recommended that the School Corporation's management establish a system of internal controlsto ensure compliance and comply with the grant agreement and the Procurement and Suspension andDebarment compliance requirement.Views of Responsible OfficialsFor the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
Subject: Child Nutrition Cluster - Procurement and Suspension and DebarmentFederal Agency: Department of AgricultureFederal Programs: School Breakfast Program, COVID-19 - School Breakfast Program, National SchoolLunch Program, COVID-19 - National School Lunch Program, Summer FoodService Program, COVID-19 - Summer Food Service Program for ChildrenAssistance Listings Numbers: 10.553, 10.555, 10.559Federal Award Numbers and Years (or Other Identifying Numbers): FY21, FY22Pass-Through Entity: Indiana Department of EducationCompliance Requirement: Procurement and Suspension and DebarmentAudit Findings: Material Weakness, Other MattersRepeat FindingThis is a repeat finding for suspension and debarment from the immediately prior report. The prioraudit finding number was 2020-004.INDIANA STATE BOARD OF ACCOUNTS23BLACKFORD COUNTY SCHOOLSSCHEDULE OF FINDINGS AND QUESTIONED COSTS(Continued)Condition and ContextAn effective internal control system was not in place at the School Corporation to ensurecompliance with requirements related to the grant agreement and the Procurement and Suspension andDebarment compliance requirement.Federal regulations allow for informal procurement methods when the value of the procurement forproperty or services does not exceed the simplified acquisition threshold, which is set at $250,000.However, Indiana Code 5-22-8 has a more restrictive threshold of $150,000 or less for when small purchaseprocedures may be used. This informal process allows for methods other than the formal bid process. Theinformal process is divided between two methods based on thresholds. Micro-purchases, typically for thosepurchases $10,000 or under, and small purchase procedures for those purchases above the micropurchasethreshold, but below the simplified acquisition threshold. Micro-purchases may be awardedwithout soliciting competitive price rate quotations. If small purchase procedures are used, then price orrate quotations must be obtained from an adequate number of qualified sources.The School Corporation did not obtain price or rate quotes for six vendors tested that were lessthan the simplified acquisition threshold of $150,000 but exceeded the $10,000 micro-purchase threshold.The micro-purchase threshold may be increased, but the School Corporation did not provide documentationthat the threshold had been increased.The School Corporation engaged with an Education Service Center that was not an approvedSchool Food Authority (SFA) cooperative. Since the Education Service Center failed to meet therequirements to be an approved SFA cooperative, the obligation reverted to the School Corporation. TheSchool Corporation did not obtain price or rate quotes for purchases of milk, exceeding $10,000 from anadequate number of sources, which fell under the small purchase procedures. In addition, the SchoolCorporation did not verify the milk vendor with a contract over $25,000 was not excluded or disqualifiedfrom participation in federal award programs.The lack of internal controls and noncompliance were systemic issues throughout the audit period.Criteria2 CFR 200.303 states in part:"The non-Federal entity must:(a) Establish and maintain effective internal control over the Federal award that providesreasonable assurance that the non-Federal entity is managing the Federal award incompliance with Federal statutes, regulations, and the terms and conditions of the Federalaward. These internal controls should be in compliance with guidance in 'Standards forInternal Control in the Federal Government' issued by the Comptroller General of theUnited States or the 'Internal Control Integrated Framework', issued by the Committee ofSponsoring Organizations of the Treadway Commission (COSO). . . ."2 CFR 200.318(i) states:"The non-Federal entity must maintain records sufficient to detail the history of procurement.These records will include, but are not necessarily limited to, the following: Rationale for themethod of procurement, selection of contract type, contractor selection or rejection, and thebasis for the contract price."INDIANA STATE BOARD OF ACCOUNTS24BLACKFORD COUNTY SCHOOLSSCHEDULE OF FINDINGS AND QUESTIONED COSTS(Continued)2 CFR 200.320(b) (Uniform Guidance) states:"Procurement by small purchase procedures. Small purchase procedures are those relativelysimple and informal procurement methods for securing services, supplies, or other propertythat do not cost more than the Simplified Acquisition Threshold. If small purchase proceduresare used, price or rate quotations must be obtained from an adequate number of qualifiedsources."2 CFR 200.320 (Revised Uniform Guidance) states in part:"The non-Federal entity must have and use document procurement procedures, consistent withthe standards of this section and ?? 200.317, 200.318, and 200.319 for any of the followingmethods of procurement used for the acquisition of property or services required under aFederal award or sub-award.(a) Informal procurement methods. When the value of the procurement for property orservices under a Federal award does not exceed the Simplified Acquisition Threshold(SAT), as defined in ? 200.1, or a lower threshold established by a non-Federal entity,formal procurement methods are not required. The non-Federal entity may use informalprocurement methods to expedite the completion of its transactions and minimize theassociated administrative burden and cost. The informal methods used for procurementof property or services at or below the SAT include: . . .(2) Small purchases ?(i) Small purchase procedures. The acquisition of property or services, theaggregate dollar amount of which is higher than the micro-purchase threshold butdoes not exceed the simplified acquisition threshold. If small purchase proceduresare used, price or rate quotations must be obtained from an adequate number ofqualified sources as determined appropriate by the non-Federal entity. . . ."Indiana Code 5-22-8-3 states:"(a) This section applies only if the purchasing agent expects the purchase to be:(1) at least fifty thousand dollars ($50,000); and(2) not more than one hundred fifty thousand dollars ($150,000). . . ."CauseManagement had not established a system of internal controls that would have ensured compliancewith the grant agreement and the Procurement and Suspension and Debarment compliance requirement.EffectThe failure to establish an effective system of internal controls enabled noncompliance to go undetected.Noncompliance with the grant agreement and the Procurement and Suspension and Debarmentcompliance requirement could result in the loss of future federal funds to the School Corporation.INDIANA STATE BOARD OF ACCOUNTS25BLACKFORD COUNTY SCHOOLSSCHEDULE OF FINDINGS AND QUESTIONED COSTS(Continued)Questioned CostsThere were no questioned costs identified.RecommendationWe recommended that the School Corporation's management establish a system of internal controlsto ensure compliance and comply with the grant agreement and the Procurement and Suspension andDebarment compliance requirement.Views of Responsible OfficialsFor the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
Finding 2022-018 ? Procurement and Suspension and DebarmentIdentification of the federal program U.S. Department of DefenseU.S. Department of Health and Human ServicesResearch and Development ClusterAssistance Listing Nos.12.420, 93.103, and 93.853See Schedule of Findings and Questioned Costs for chart/tableSt. Joseph?s Hospital and Medical CenterCriteria or specific requirement (including statutory, regulatory, orother citation) 2 CFR 200.303(a) requires that the non-Federal entity must ?(a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).?2 CFR 200.318 (i) General Procurement Standards states, ?the non-Federal entity must maintain records sufficient to detail the history of procurement. These records will include, but are not necessarily limited to, the following: Rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price.?Criteria or specific requirement (including statutory, regulatory, orother citation) (continued) 2 CFR 200.320 (c) Noncompetitive procurement states, ?there are specific circumstances in which noncompetitive procurement can be used. Noncompetitive procurement can only be awarded if one or more of the following circumstances apply:(1) The acquisition of property or services, the aggregate dollar amount of which does not exceed the micro-purchase threshold (see paragraph (a)(1) of this section);(2) The item is available only from a single source;(3) The public exigency or emergency for the requirement will not permit a delay resulting from publicizing a competitive solicitation;(4) The Federal awarding agency or pass-through entity expressly authorizes a noncompetitive procurement in response to a written request from the non-Federal entity; or(5) After solicitation of a number of sources, competition is determined inadequate.?Condition St. Joseph?s Hospital and Medical Center did not prepare and retain documentation of sole source justification for three procurements over the micro-purchase threshold made without competition.Cause St. Joseph?s Hospital and Medical Center did not have effective internal controls over preparation and retention of the rationale of the method of procurement.Effect or potential effect Noncompliance with the procurement documentation requirements of 2 CFR 200.318 (i) and without adequate documentation of sole source justification there is greater potential for noncompliance with noncompetitive procurement requirements in 2 CFR 200.320 (c).Questioned costs None.Context For 3 of 5 procurements selected for testing, St. Joseph?s Hospital and Medical Center indicated the procurement was a noncompetitive procurement (sole source) but did not have documentation to support the rationale for the sole source procurement.We selected and tested five procurements with expenditures totaling $151,515 from a population of 6 procurements with expenditures totaling $161,960 charged to the St. Joseph?s Hospital and Medical Center during the year ended June 30, 2022. The three noncompetitive procurements tested totaled $43,356.Identification as a repeat finding, if applicable This is not a repeat finding.Recommendation St. Joseph?s Hospital and Medical Center should retain written documentation for procurements documenting the history of the procurement prior to the procurement of goods or services, including, but not limited to, the rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price.Views of responsibleofficials Management agrees with the finding and will implement corrective action by April 2023.
Finding 2022-018 ? Procurement and Suspension and DebarmentIdentification of the federal program U.S. Department of DefenseU.S. Department of Health and Human ServicesResearch and Development ClusterAssistance Listing Nos.12.420, 93.103, and 93.853See Schedule of Findings and Questioned Costs for chart/tableSt. Joseph?s Hospital and Medical CenterCriteria or specific requirement (including statutory, regulatory, orother citation) 2 CFR 200.303(a) requires that the non-Federal entity must ?(a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).?2 CFR 200.318 (i) General Procurement Standards states, ?the non-Federal entity must maintain records sufficient to detail the history of procurement. These records will include, but are not necessarily limited to, the following: Rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price.?Criteria or specific requirement (including statutory, regulatory, orother citation) (continued) 2 CFR 200.320 (c) Noncompetitive procurement states, ?there are specific circumstances in which noncompetitive procurement can be used. Noncompetitive procurement can only be awarded if one or more of the following circumstances apply:(1) The acquisition of property or services, the aggregate dollar amount of which does not exceed the micro-purchase threshold (see paragraph (a)(1) of this section);(2) The item is available only from a single source;(3) The public exigency or emergency for the requirement will not permit a delay resulting from publicizing a competitive solicitation;(4) The Federal awarding agency or pass-through entity expressly authorizes a noncompetitive procurement in response to a written request from the non-Federal entity; or(5) After solicitation of a number of sources, competition is determined inadequate.?Condition St. Joseph?s Hospital and Medical Center did not prepare and retain documentation of sole source justification for three procurements over the micro-purchase threshold made without competition.Cause St. Joseph?s Hospital and Medical Center did not have effective internal controls over preparation and retention of the rationale of the method of procurement.Effect or potential effect Noncompliance with the procurement documentation requirements of 2 CFR 200.318 (i) and without adequate documentation of sole source justification there is greater potential for noncompliance with noncompetitive procurement requirements in 2 CFR 200.320 (c).Questioned costs None.Context For 3 of 5 procurements selected for testing, St. Joseph?s Hospital and Medical Center indicated the procurement was a noncompetitive procurement (sole source) but did not have documentation to support the rationale for the sole source procurement.We selected and tested five procurements with expenditures totaling $151,515 from a population of 6 procurements with expenditures totaling $161,960 charged to the St. Joseph?s Hospital and Medical Center during the year ended June 30, 2022. The three noncompetitive procurements tested totaled $43,356.Identification as a repeat finding, if applicable This is not a repeat finding.Recommendation St. Joseph?s Hospital and Medical Center should retain written documentation for procurements documenting the history of the procurement prior to the procurement of goods or services, including, but not limited to, the rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price.Views of responsibleofficials Management agrees with the finding and will implement corrective action by April 2023.
Finding 2022-018 ? Procurement and Suspension and DebarmentIdentification of the federal program U.S. Department of DefenseU.S. Department of Health and Human ServicesResearch and Development ClusterAssistance Listing Nos.12.420, 93.103, and 93.853See Schedule of Findings and Questioned Costs for chart/tableSt. Joseph?s Hospital and Medical CenterCriteria or specific requirement (including statutory, regulatory, orother citation) 2 CFR 200.303(a) requires that the non-Federal entity must ?(a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).?2 CFR 200.318 (i) General Procurement Standards states, ?the non-Federal entity must maintain records sufficient to detail the history of procurement. These records will include, but are not necessarily limited to, the following: Rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price.?Criteria or specific requirement (including statutory, regulatory, orother citation) (continued) 2 CFR 200.320 (c) Noncompetitive procurement states, ?there are specific circumstances in which noncompetitive procurement can be used. Noncompetitive procurement can only be awarded if one or more of the following circumstances apply:(1) The acquisition of property or services, the aggregate dollar amount of which does not exceed the micro-purchase threshold (see paragraph (a)(1) of this section);(2) The item is available only from a single source;(3) The public exigency or emergency for the requirement will not permit a delay resulting from publicizing a competitive solicitation;(4) The Federal awarding agency or pass-through entity expressly authorizes a noncompetitive procurement in response to a written request from the non-Federal entity; or(5) After solicitation of a number of sources, competition is determined inadequate.?Condition St. Joseph?s Hospital and Medical Center did not prepare and retain documentation of sole source justification for three procurements over the micro-purchase threshold made without competition.Cause St. Joseph?s Hospital and Medical Center did not have effective internal controls over preparation and retention of the rationale of the method of procurement.Effect or potential effect Noncompliance with the procurement documentation requirements of 2 CFR 200.318 (i) and without adequate documentation of sole source justification there is greater potential for noncompliance with noncompetitive procurement requirements in 2 CFR 200.320 (c).Questioned costs None.Context For 3 of 5 procurements selected for testing, St. Joseph?s Hospital and Medical Center indicated the procurement was a noncompetitive procurement (sole source) but did not have documentation to support the rationale for the sole source procurement.We selected and tested five procurements with expenditures totaling $151,515 from a population of 6 procurements with expenditures totaling $161,960 charged to the St. Joseph?s Hospital and Medical Center during the year ended June 30, 2022. The three noncompetitive procurements tested totaled $43,356.Identification as a repeat finding, if applicable This is not a repeat finding.Recommendation St. Joseph?s Hospital and Medical Center should retain written documentation for procurements documenting the history of the procurement prior to the procurement of goods or services, including, but not limited to, the rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price.Views of responsibleofficials Management agrees with the finding and will implement corrective action by April 2023.
2022 ? 005 ? Child Nutrition Cluster ? Suspension and DebarmentFederal Agency: U.S. Department of EducationFederal Program Title: Child Nutrition ClusterAssistance Listing Number: 10.553/10.555Federal Award Identification Number and Year: FY 21 and FY 22Pass-Through Entity: Indiana Department of EducationPass-Through Entity Number: FY 2021 and FY 2022Award Period: July 1, 2020 through June 30, 2022Type of Finding:? Significant Deficiency in Internal Control over ComplianceCriteria: ?Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. (2 CFR sections 200.212 and 200.318(h); 2 CFR section 180.300; 48 CFR section 52.209-6).?Condition: During our testing, we noted Suspension and debarment checks were not performed on the contract sampled. Per the school?s procurement policy, it stated that a certification of suspension and debarment needed to be completed prior to entering into a contract for all contracts over the $25,000 threshold.Questioned costs: NoneContext: Using a statistically valid sample, 1 covered transaction was selected for testing. The Transaction selected did not have a suspension and debarment certification prior to entering in a contract with the vendor.Cause: Improper understanding and implementation of existing policies.Effect: Contracts could be entered into with suspended or debarred vendors leading to noncompliance.Repeat Finding: No.Recommendation: We recommend the South Montgomery Community School Corporation increased training for those individuals involved in procurement and contract approval to ensure suspension and debarment checks are performed prior to awarding contracts.View of Responsible Officials: There is no disagreement with the audit finding.
2022 ? 005 ? Child Nutrition Cluster ? Suspension and DebarmentFederal Agency: U.S. Department of EducationFederal Program Title: Child Nutrition ClusterAssistance Listing Number: 10.553/10.555Federal Award Identification Number and Year: FY 21 and FY 22Pass-Through Entity: Indiana Department of EducationPass-Through Entity Number: FY 2021 and FY 2022Award Period: July 1, 2020 through June 30, 2022Type of Finding:? Significant Deficiency in Internal Control over ComplianceCriteria: ?Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. (2 CFR sections 200.212 and 200.318(h); 2 CFR section 180.300; 48 CFR section 52.209-6).?Condition: During our testing, we noted Suspension and debarment checks were not performed on the contract sampled. Per the school?s procurement policy, it stated that a certification of suspension and debarment needed to be completed prior to entering into a contract for all contracts over the $25,000 threshold.Questioned costs: NoneContext: Using a statistically valid sample, 1 covered transaction was selected for testing. The Transaction selected did not have a suspension and debarment certification prior to entering in a contract with the vendor.Cause: Improper understanding and implementation of existing policies.Effect: Contracts could be entered into with suspended or debarred vendors leading to noncompliance.Repeat Finding: No.Recommendation: We recommend the South Montgomery Community School Corporation increased training for those individuals involved in procurement and contract approval to ensure suspension and debarment checks are performed prior to awarding contracts.View of Responsible Officials: There is no disagreement with the audit finding.
2022 ? 005 ? Child Nutrition Cluster ? Suspension and DebarmentFederal Agency: U.S. Department of EducationFederal Program Title: Child Nutrition ClusterAssistance Listing Number: 10.553/10.555Federal Award Identification Number and Year: FY 21 and FY 22Pass-Through Entity: Indiana Department of EducationPass-Through Entity Number: FY 2021 and FY 2022Award Period: July 1, 2020 through June 30, 2022Type of Finding:? Significant Deficiency in Internal Control over ComplianceCriteria: ?Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. (2 CFR sections 200.212 and 200.318(h); 2 CFR section 180.300; 48 CFR section 52.209-6).?Condition: During our testing, we noted Suspension and debarment checks were not performed on the contract sampled. Per the school?s procurement policy, it stated that a certification of suspension and debarment needed to be completed prior to entering into a contract for all contracts over the $25,000 threshold.Questioned costs: NoneContext: Using a statistically valid sample, 1 covered transaction was selected for testing. The Transaction selected did not have a suspension and debarment certification prior to entering in a contract with the vendor.Cause: Improper understanding and implementation of existing policies.Effect: Contracts could be entered into with suspended or debarred vendors leading to noncompliance.Repeat Finding: No.Recommendation: We recommend the South Montgomery Community School Corporation increased training for those individuals involved in procurement and contract approval to ensure suspension and debarment checks are performed prior to awarding contracts.View of Responsible Officials: There is no disagreement with the audit finding.
2022 ? 005 ? Child Nutrition Cluster ? Suspension and DebarmentFederal Agency: U.S. Department of EducationFederal Program Title: Child Nutrition ClusterAssistance Listing Number: 10.553/10.555Federal Award Identification Number and Year: FY 21 and FY 22Pass-Through Entity: Indiana Department of EducationPass-Through Entity Number: FY 2021 and FY 2022Award Period: July 1, 2020 through June 30, 2022Type of Finding:? Significant Deficiency in Internal Control over ComplianceCriteria: ?Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. (2 CFR sections 200.212 and 200.318(h); 2 CFR section 180.300; 48 CFR section 52.209-6).?Condition: During our testing, we noted Suspension and debarment checks were not performed on the contract sampled. Per the school?s procurement policy, it stated that a certification of suspension and debarment needed to be completed prior to entering into a contract for all contracts over the $25,000 threshold.Questioned costs: NoneContext: Using a statistically valid sample, 1 covered transaction was selected for testing. The Transaction selected did not have a suspension and debarment certification prior to entering in a contract with the vendor.Cause: Improper understanding and implementation of existing policies.Effect: Contracts could be entered into with suspended or debarred vendors leading to noncompliance.Repeat Finding: No.Recommendation: We recommend the South Montgomery Community School Corporation increased training for those individuals involved in procurement and contract approval to ensure suspension and debarment checks are performed prior to awarding contracts.View of Responsible Officials: There is no disagreement with the audit finding.
2022 ? 005 ? Child Nutrition Cluster ? Suspension and DebarmentFederal Agency: U.S. Department of EducationFederal Program Title: Child Nutrition ClusterAssistance Listing Number: 10.553/10.555Federal Award Identification Number and Year: FY 21 and FY 22Pass-Through Entity: Indiana Department of EducationPass-Through Entity Number: FY 2021 and FY 2022Award Period: July 1, 2020 through June 30, 2022Type of Finding:? Significant Deficiency in Internal Control over ComplianceCriteria: ?Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. (2 CFR sections 200.212 and 200.318(h); 2 CFR section 180.300; 48 CFR section 52.209-6).?Condition: During our testing, we noted Suspension and debarment checks were not performed on the contract sampled. Per the school?s procurement policy, it stated that a certification of suspension and debarment needed to be completed prior to entering into a contract for all contracts over the $25,000 threshold.Questioned costs: NoneContext: Using a statistically valid sample, 1 covered transaction was selected for testing. The Transaction selected did not have a suspension and debarment certification prior to entering in a contract with the vendor.Cause: Improper understanding and implementation of existing policies.Effect: Contracts could be entered into with suspended or debarred vendors leading to noncompliance.Repeat Finding: No.Recommendation: We recommend the South Montgomery Community School Corporation increased training for those individuals involved in procurement and contract approval to ensure suspension and debarment checks are performed prior to awarding contracts.View of Responsible Officials: There is no disagreement with the audit finding.
2022 ? 005 ? Child Nutrition Cluster ? Suspension and DebarmentFederal Agency: U.S. Department of EducationFederal Program Title: Child Nutrition ClusterAssistance Listing Number: 10.553/10.555Federal Award Identification Number and Year: FY 21 and FY 22Pass-Through Entity: Indiana Department of EducationPass-Through Entity Number: FY 2021 and FY 2022Award Period: July 1, 2020 through June 30, 2022Type of Finding:? Significant Deficiency in Internal Control over ComplianceCriteria: ?Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. (2 CFR sections 200.212 and 200.318(h); 2 CFR section 180.300; 48 CFR section 52.209-6).?Condition: During our testing, we noted Suspension and debarment checks were not performed on the contract sampled. Per the school?s procurement policy, it stated that a certification of suspension and debarment needed to be completed prior to entering into a contract for all contracts over the $25,000 threshold.Questioned costs: NoneContext: Using a statistically valid sample, 1 covered transaction was selected for testing. The Transaction selected did not have a suspension and debarment certification prior to entering in a contract with the vendor.Cause: Improper understanding and implementation of existing policies.Effect: Contracts could be entered into with suspended or debarred vendors leading to noncompliance.Repeat Finding: No.Recommendation: We recommend the South Montgomery Community School Corporation increased training for those individuals involved in procurement and contract approval to ensure suspension and debarment checks are performed prior to awarding contracts.View of Responsible Officials: There is no disagreement with the audit finding.
Criteria: Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) 200.318 General Procurement Standards requires entities to have documented procurement procedures that conform to the procurement standards identified in 2 CFR 200.317 through 200.327. Condition: The City does not have formal documented procurement policies and procedures related to expenditures of federal awards. Cause: The City Council forms a committee to review and approve disbursements of federal funds. This process is the City’s general practice but does not follow written procurement policies and procedures. Effect: The City is out of compliance with general procurement standards under 2 CFR 200.318. Recommendation: The City should adopt formal documented procurement policies and procedures related to expenditures of federal awards. Response: The City Clerk and Mayor, with help from the Treasurer, will develop and implement documented procurement procedures that conform to the procurement standards relating to Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) 200.317 through 200.327.
Criteria: Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) 200.318 General Procurement Standards requires entities to have documented procurement procedures that conform to the procurement standards identified in 2 CFR 200.317 through 200.327. Condition: The City does not have formal documented procurement policies and procedures related to expenditures of federal awards. Cause: The City Council forms a committee to review and approve disbursements of federal funds. This process is the City’s general practice but does not follow written procurement policies and procedures. Effect: The City is out of compliance with general procurement standards under 2 CFR 200.318. Recommendation: The City should adopt formal documented procurement policies and procedures related to expenditures of federal awards. Response: The City Clerk and Mayor, with help from the Treasurer, will develop and implement documented procurement procedures that conform to the procurement standards relating to Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) 200.317 through 200.327.
Criteria: Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) 200.318 General Procurement Standards requires entities to have documented procurement procedures that conform to the procurement standards identified in 2 CFR 200.317 through 200.327. Condition: The City does not have formal documented procurement policies and procedures related to expenditures of federal awards. Cause: The City Council forms a committee to review and approve disbursements of federal funds. This process is the City’s general practice but does not follow written procurement policies and procedures. Effect: The City is out of compliance with general procurement standards under 2 CFR 200.318. Recommendation: The City should adopt formal documented procurement policies and procedures related to expenditures of federal awards. Response: The City Clerk and Mayor, with help from the Treasurer, will develop and implement documented procurement procedures that conform to the procurement standards relating to Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) 200.317 through 200.327.
CONDITION: During my review of the District’s compliance with the requirements for noncompetitive procurement, I noted the District did not document its rationale for purchases made from four (4) vendors - CJAWS, Inc., Edmentum, Inc., Savvas Learning Company, and Technology Resource Advisors, Inc. This is a repeat finding (2021-007) from the previous fiscal year for CJAWS, Inc. CRITERIA: In accordance with Section 2 CFR 200.318(i) of the Uniform Guidance, the District must maintain records sufficient to detail the history of procurement. These records include but are not limited to the rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price. Furthermore, Section 2 CFR 200.320(c’) of the Uniform Guidance details five (5) circumstances in which noncompetitive procurement can be used. EFFECT: The District did not comply with Section 2 CFR 200.318(i) and Section 2 CFR 200.320(c’) of the Uniform Guidance regarding the proper documentation required for noncompetitive procurement. QUESTIONED COST: CJAWS, Inc. - $197,791, Edmentum, Inc. - $19,190, Savvas Learning Company - $14,418, Technology Resource Advisors, Inc. - $22,220 CAUSE: From a review of the School District’s policies as published on the District’s website, the District has not updated their policies to include those related to ‘federal fiscal compliance’ in accordance with the Uniform Guidance, in particular, procurement policies to address the requirements of Section 2 CFR 200.318(i) and 320(c). RECOMMENDATION: I recommend that the School District update their policies to include those most recent related to ‘federal fiscal compliance’ in accordance with the Uniform Guidance, in particular, procurement policies to address the requirements of Section 2 CFR 200.318(i) and 320(c). In addition, I would recommend that District personnel responsible for expenditures related to federal funding receive updated training related to ‘procurement’ policies and procedures as they relate to federal funding. VIEWS OF RESPONSIBLE OFFICIALS: The School District concurs with the above noted finding and addresses this issue in the ‘Corrective Action Plan’ included within this report.
CONDITION: During my review of the District’s compliance with the requirements for noncompetitive procurement, I noted the District did not document its rationale for purchases made from four (4) vendors - CJAWS, Inc., Edmentum, Inc., Savvas Learning Company, and Technology Resource Advisors, Inc. This is a repeat finding (2021-007) from the previous fiscal year for CJAWS, Inc. CRITERIA: In accordance with Section 2 CFR 200.318(i) of the Uniform Guidance, the District must maintain records sufficient to detail the history of procurement. These records include but are not limited to the rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price. Furthermore, Section 2 CFR 200.320(c’) of the Uniform Guidance details five (5) circumstances in which noncompetitive procurement can be used. EFFECT: The District did not comply with Section 2 CFR 200.318(i) and Section 2 CFR 200.320(c’) of the Uniform Guidance regarding the proper documentation required for noncompetitive procurement. QUESTIONED COST: CJAWS, Inc. - $197,791, Edmentum, Inc. - $19,190, Savvas Learning Company - $14,418, Technology Resource Advisors, Inc. - $22,220 CAUSE: From a review of the School District’s policies as published on the District’s website, the District has not updated their policies to include those related to ‘federal fiscal compliance’ in accordance with the Uniform Guidance, in particular, procurement policies to address the requirements of Section 2 CFR 200.318(i) and 320(c). RECOMMENDATION: I recommend that the School District update their policies to include those most recent related to ‘federal fiscal compliance’ in accordance with the Uniform Guidance, in particular, procurement policies to address the requirements of Section 2 CFR 200.318(i) and 320(c). In addition, I would recommend that District personnel responsible for expenditures related to federal funding receive updated training related to ‘procurement’ policies and procedures as they relate to federal funding. VIEWS OF RESPONSIBLE OFFICIALS: The School District concurs with the above noted finding and addresses this issue in the ‘Corrective Action Plan’ included within this report.
CONDITION: During my review of the District’s compliance with the requirements for noncompetitive procurement, I noted the District did not document its rationale for purchases made from four (4) vendors - CJAWS, Inc., Edmentum, Inc., Savvas Learning Company, and Technology Resource Advisors, Inc. This is a repeat finding (2021-007) from the previous fiscal year for CJAWS, Inc. CRITERIA: In accordance with Section 2 CFR 200.318(i) of the Uniform Guidance, the District must maintain records sufficient to detail the history of procurement. These records include but are not limited to the rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price. Furthermore, Section 2 CFR 200.320(c’) of the Uniform Guidance details five (5) circumstances in which noncompetitive procurement can be used. EFFECT: The District did not comply with Section 2 CFR 200.318(i) and Section 2 CFR 200.320(c’) of the Uniform Guidance regarding the proper documentation required for noncompetitive procurement. QUESTIONED COST: CJAWS, Inc. - $197,791, Edmentum, Inc. - $19,190, Savvas Learning Company - $14,418, Technology Resource Advisors, Inc. - $22,220 CAUSE: From a review of the School District’s policies as published on the District’s website, the District has not updated their policies to include those related to ‘federal fiscal compliance’ in accordance with the Uniform Guidance, in particular, procurement policies to address the requirements of Section 2 CFR 200.318(i) and 320(c). RECOMMENDATION: I recommend that the School District update their policies to include those most recent related to ‘federal fiscal compliance’ in accordance with the Uniform Guidance, in particular, procurement policies to address the requirements of Section 2 CFR 200.318(i) and 320(c). In addition, I would recommend that District personnel responsible for expenditures related to federal funding receive updated training related to ‘procurement’ policies and procedures as they relate to federal funding. VIEWS OF RESPONSIBLE OFFICIALS: The School District concurs with the above noted finding and addresses this issue in the ‘Corrective Action Plan’ included within this report.
Finding 2022-002 – Special Education Cluster – AL No.’s 84.027 & 84.173 Department of Education Massachusetts Department of Elementary and Secondary Education Massachusetts Department of Early Education and Care Noncompliance and Significant Deficiency Related to Internal Control over Compliance of the Major Programs Criteria: 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. As governmental subrecipients of states are also required to use the same state procurement policies and procedures for federal funds as for non‐federal funds, the Town is required to follow Massachusetts General Laws, Chapter (MGL) 30(b). MGL 30(b) requires the solicitation of three written or oral quotes for procurements of supplies between $10,000 and $49,999 and sealed bids or proposals for procurements of supplies $50,000 and over. Management of the Town is also responsible for establishing and maintaining effective internal control over compliance with federal requirements that have a direct and material effect on a federal program. A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis. Condition and Context: During fiscal year 2022, the Town did not comply with the required procurement policies and procedures process for procurements that exceeded both State and Federal thresholds. Questioned Costs: Unkown Cause: Weaknesses in the design and operation of controls. Effect or Potential Effect: Due to the weaknesses in internal controls noted above, there is a risk that amounts charged to federal awards may not be in accordance with procurement, suspension, and debarment principles. No known questioned costs are reported, as it is not quantifiable. Identification as a Repeat Finding: Yes, finding number 2021-002 Recommendation: The Town should address the weaknesses in internal controls noted above in order to ensure that procurements are conducted in accordance with federal and state requirements. Managements Response: The Town and Schools have Acushnet’s Federal Grant Procedures Manual (February 2023) to ensure that procurements are conducted in accordance with Federal and State requirements – in particular, the procurement standards set out at 2 CFR sections 200.318 through 200.326
Finding 2022-002 – Special Education Cluster – AL No.’s 84.027 & 84.173 Department of Education Massachusetts Department of Elementary and Secondary Education Massachusetts Department of Early Education and Care Noncompliance and Significant Deficiency Related to Internal Control over Compliance of the Major Programs Criteria: 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. As governmental subrecipients of states are also required to use the same state procurement policies and procedures for federal funds as for non‐federal funds, the Town is required to follow Massachusetts General Laws, Chapter (MGL) 30(b). MGL 30(b) requires the solicitation of three written or oral quotes for procurements of supplies between $10,000 and $49,999 and sealed bids or proposals for procurements of supplies $50,000 and over. Management of the Town is also responsible for establishing and maintaining effective internal control over compliance with federal requirements that have a direct and material effect on a federal program. A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis. Condition and Context: During fiscal year 2022, the Town did not comply with the required procurement policies and procedures process for procurements that exceeded both State and Federal thresholds. Questioned Costs: Unkown Cause: Weaknesses in the design and operation of controls. Effect or Potential Effect: Due to the weaknesses in internal controls noted above, there is a risk that amounts charged to federal awards may not be in accordance with procurement, suspension, and debarment principles. No known questioned costs are reported, as it is not quantifiable. Identification as a Repeat Finding: Yes, finding number 2021-002 Recommendation: The Town should address the weaknesses in internal controls noted above in order to ensure that procurements are conducted in accordance with federal and state requirements. Managements Response: The Town and Schools have Acushnet’s Federal Grant Procedures Manual (February 2023) to ensure that procurements are conducted in accordance with Federal and State requirements – in particular, the procurement standards set out at 2 CFR sections 200.318 through 200.326
2022-003 Procurement Policies and Covered Transactions Compliance Requirement Procurement, Suspension, and Debarment Category Significant Deficiency in Internal Control and Noncompliance Federal Agency U.S. Department of the Treasury Pass-Through Entity Puerto Rico Fiscal Agency and Financial Advisory Authority ALN 21.027 Federal Program COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Criteria 2 CFR section 200.318 General procurement standards. (a) The non-Federal entity must have and use documented procurement procedures, consistent with State, local, and tribal laws and regulations and the standards of this section, for the acquisition of property or services required under a Federal award or subaward. The non-Federal entity's documented procurement procedures must conform to the procurement standards identified in §§ 200.317 through 200.327. 2 CFR section 180.220 Are any procurement contracts included as covered transactions? (a) Covered transactions under this part— (1) Do not include any procurement contracts awarded directly by a Federal agency; but (2) Do include some procurement contracts awarded by non-Federal participants in nonprocurement covered transactions. (b) Specifically, a contract for goods or services is a covered transaction if any of the following applies: (1) The contract is awarded by a participant in a nonprocurement transaction that is covered under § 180.210, and the amount of the contract is expected to equal or exceed $25,000. (2) The contract requires the consent of an official of a Federal agency. In that case, the contract, regardless of the amount, always is a covered transaction, and it does not matter who awarded it. For example, it could be a subcontract awarded by a contractor at a tier below a nonprocurement transaction, as shown in the appendix to this part. (3) The contract is for Federally-required audit services. (c) A subcontract also is a covered transaction if,— (1) It is awarded by a participant in a procurement transaction under a nonprocurement transaction of a Federal agency that extends the coverage of paragraph (b)(1) of this section to additional tiers of contracts (see the diagram in the appendix to this part showing that optional lower tier coverage); and (2) The value of the subcontract is expected to equal or exceed $25,000. Condition General Procurement Standards - Written Policies The Corporation has an outdated institutional procurement manual approved in 2014 that lacks written policies to ascertain compliance with the provisions of federal statutes, regulations, or the terms and conditions of federal awards regarding procurement, suspension, and debarment requirements. Suspension and Debarment - Covered Transaction From a population of nineteen disbursements, we selected nine disbursements to ascertain compliance with 2 CFR section 180.220 by examining the procurement documents provided by the Corporation. From that sample, we identified nine instances in which the SAM.gov registration verification process was not performed. Of the nine instances, we found eight suppliers properly registered, but one supplier appears as validated as unique and existing but not registered in SAM.gov. Cause Lack of understanding of procurement compliance requirements for federal awards. Fiscal year 2023 was the first year for the Corporation to be subjected to a single audit compliance requirement for receiving and expending COVID-19 public health emergency programs. Effect Noncompliance with sections 200.318 and 180.220 of 2 CFR may lead to temporary withholding of cash payments until the deficiency is corrected, and/or withholding further federal program awards. Questioned Costs None Recommendation General Procurement Standards - Written Policies and Suspension and Debarment - Covered Transaction We recommend the Corporation update its internal procurement written policies following the provisions of current state statutes and regulations and develop separate procurement written policies following the provisions of federal laws and regulations or the terms and conditions of federal awards, which includes the Procurement Standards described in 2 CFR section 200.317 through 200.327, as applicable. By updating, developing, and implementing the required written procurement policies, the Corporation will be able to comply with the federal government compliance requirements. Views of responsible officials Refer to Corrective Action Plan section.
Federal agency: U.S. Department of Education Federal program title: Special Education Cluster Assistance Listing Number: 84.027, 84.173 Pass-Through Agency: Massachusetts Department of Elementary and Secondary Education and Massachusetts Department of Early Education and Care Pass-Through Number(s): Various (see Schedule of Expenditures of Federal Awards) Award Period: July 1, 2021 – June 30, 2022 Type of Finding: • Material Weakness in Internal Control over Compliance • Material Noncompliance (Modified Opinion) Compliance Requirement: Procurement Criteria or Specific Requirement: 2 CFR section 200.318, part (i) requires that the non-Federal entity must maintain records sufficient to detail the history of procurement. These records will include but are not necessarily limited to the following: rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price. Condition and Context: For all five contracts selected for testing, records sufficient to detail the history of procurement were not maintained. The sample was a statistically valid sample. Questioned Costs: Cannot be determined Cause: Procedures to maintain records sufficient to detail the history of all procurements related to federal funds needs to be strengthened. Effect: Noncompliance with the federal program occurred. Repeat Finding: Yes (Finding 2021-002) Recommendation: We recommend procedures to maintain records sufficient to detail the history of all procurements be strengthened. Views of Responsible Officials: Management agrees with the finding.
Federal agency: U.S. Department of Education Federal program title: Special Education Cluster Assistance Listing Number: 84.027, 84.173 Pass-Through Agency: Massachusetts Department of Elementary and Secondary Education and Massachusetts Department of Early Education and Care Pass-Through Number(s): Various (see Schedule of Expenditures of Federal Awards) Award Period: July 1, 2021 – June 30, 2022 Type of Finding: • Material Weakness in Internal Control over Compliance • Material Noncompliance (Modified Opinion) Compliance Requirement: Procurement Criteria or Specific Requirement: 2 CFR section 200.318, part (i) requires that the non-Federal entity must maintain records sufficient to detail the history of procurement. These records will include but are not necessarily limited to the following: rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price. Condition and Context: For all five contracts selected for testing, records sufficient to detail the history of procurement were not maintained. The sample was a statistically valid sample. Questioned Costs: Cannot be determined Cause: Procedures to maintain records sufficient to detail the history of all procurements related to federal funds needs to be strengthened. Effect: Noncompliance with the federal program occurred. Repeat Finding: Yes (Finding 2021-002) Recommendation: We recommend procedures to maintain records sufficient to detail the history of all procurements be strengthened. Views of Responsible Officials: Management agrees with the finding.
Federal agency: U.S. Department of Education Federal program title: Special Education Cluster Assistance Listing Number: 84.027, 84.173 Pass-Through Agency: Massachusetts Department of Elementary and Secondary Education and Massachusetts Department of Early Education and Care Pass-Through Number(s): Various (see Schedule of Expenditures of Federal Awards) Award Period: July 1, 2021 – June 30, 2022 Type of Finding: • Material Weakness in Internal Control over Compliance • Material Noncompliance (Modified Opinion) Compliance Requirement: Procurement Criteria or Specific Requirement: 2 CFR section 200.318, part (i) requires that the non-Federal entity must maintain records sufficient to detail the history of procurement. These records will include but are not necessarily limited to the following: rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price. Condition and Context: For all five contracts selected for testing, records sufficient to detail the history of procurement were not maintained. The sample was a statistically valid sample. Questioned Costs: Cannot be determined Cause: Procedures to maintain records sufficient to detail the history of all procurements related to federal funds needs to be strengthened. Effect: Noncompliance with the federal program occurred. Repeat Finding: Yes (Finding 2021-002) Recommendation: We recommend procedures to maintain records sufficient to detail the history of all procurements be strengthened. Views of Responsible Officials: Management agrees with the finding.
2022-004 — Procurement – Material Weakness in Internal Control Over Compliance and Noncompliance Federal program information: Funding agencies: U.S. Department of Interior and U.S. Department of Education Titles: Assistance to Tribally Controlled Community Colleges; Higher Education Institutional Aid; and Education Stabilization Fund ALN Number: 15.027, 84.031, and 84.425 Award years: Various Criteria: According to 2 CFR Section 200.318i, the recipient or subrecipient must maintain records sufficient to detail the history of each procurement transaction. These records must include the rationale for the procurement method, contract type selection, contractor selection or rejection, and the basis for the contract price. According to 2 CFR Section 0200.319a, All procurement transactions under the Federal award must be conducted in a manner that provides full and open competition. Condition: The College did not maintain records sufficient to detail the history of each procurement transaction for the nine procurements contracts tested. Cause: The College did not have sufficient procedures in place to ensure that procurement records are maintained. Effect: The College is not in compliance with procurement requirements. Questioned Costs: None Context: Procurement documents were not retained for nine out of nine transactions tested. Recommendation: Formally document and enforce policies and procedures that will promote adequate monitoring of the procurement and bidding process. Ensure that any contract over the College’s threshold ($150,000) follow the sealed bid requirements listed in 2 CFR Section 200.320b1. View of Responsible Officials: The College concurs with this finding.
2022-004 — Procurement – Material Weakness in Internal Control Over Compliance and Noncompliance Federal program information: Funding agencies: U.S. Department of Interior and U.S. Department of Education Titles: Assistance to Tribally Controlled Community Colleges; Higher Education Institutional Aid; and Education Stabilization Fund ALN Number: 15.027, 84.031, and 84.425 Award years: Various Criteria: According to 2 CFR Section 200.318i, the recipient or subrecipient must maintain records sufficient to detail the history of each procurement transaction. These records must include the rationale for the procurement method, contract type selection, contractor selection or rejection, and the basis for the contract price. According to 2 CFR Section 0200.319a, All procurement transactions under the Federal award must be conducted in a manner that provides full and open competition. Condition: The College did not maintain records sufficient to detail the history of each procurement transaction for the nine procurements contracts tested. Cause: The College did not have sufficient procedures in place to ensure that procurement records are maintained. Effect: The College is not in compliance with procurement requirements. Questioned Costs: None Context: Procurement documents were not retained for nine out of nine transactions tested. Recommendation: Formally document and enforce policies and procedures that will promote adequate monitoring of the procurement and bidding process. Ensure that any contract over the College’s threshold ($150,000) follow the sealed bid requirements listed in 2 CFR Section 200.320b1. View of Responsible Officials: The College concurs with this finding.
2022-004 — Procurement – Material Weakness in Internal Control Over Compliance and Noncompliance Federal program information: Funding agencies: U.S. Department of Interior and U.S. Department of Education Titles: Assistance to Tribally Controlled Community Colleges; Higher Education Institutional Aid; and Education Stabilization Fund ALN Number: 15.027, 84.031, and 84.425 Award years: Various Criteria: According to 2 CFR Section 200.318i, the recipient or subrecipient must maintain records sufficient to detail the history of each procurement transaction. These records must include the rationale for the procurement method, contract type selection, contractor selection or rejection, and the basis for the contract price. According to 2 CFR Section 0200.319a, All procurement transactions under the Federal award must be conducted in a manner that provides full and open competition. Condition: The College did not maintain records sufficient to detail the history of each procurement transaction for the nine procurements contracts tested. Cause: The College did not have sufficient procedures in place to ensure that procurement records are maintained. Effect: The College is not in compliance with procurement requirements. Questioned Costs: None Context: Procurement documents were not retained for nine out of nine transactions tested. Recommendation: Formally document and enforce policies and procedures that will promote adequate monitoring of the procurement and bidding process. Ensure that any contract over the College’s threshold ($150,000) follow the sealed bid requirements listed in 2 CFR Section 200.320b1. View of Responsible Officials: The College concurs with this finding.
2022-004 — Procurement – Material Weakness in Internal Control Over Compliance and Noncompliance Federal program information: Funding agencies: U.S. Department of Interior and U.S. Department of Education Titles: Assistance to Tribally Controlled Community Colleges; Higher Education Institutional Aid; and Education Stabilization Fund ALN Number: 15.027, 84.031, and 84.425 Award years: Various Criteria: According to 2 CFR Section 200.318i, the recipient or subrecipient must maintain records sufficient to detail the history of each procurement transaction. These records must include the rationale for the procurement method, contract type selection, contractor selection or rejection, and the basis for the contract price. According to 2 CFR Section 0200.319a, All procurement transactions under the Federal award must be conducted in a manner that provides full and open competition. Condition: The College did not maintain records sufficient to detail the history of each procurement transaction for the nine procurements contracts tested. Cause: The College did not have sufficient procedures in place to ensure that procurement records are maintained. Effect: The College is not in compliance with procurement requirements. Questioned Costs: None Context: Procurement documents were not retained for nine out of nine transactions tested. Recommendation: Formally document and enforce policies and procedures that will promote adequate monitoring of the procurement and bidding process. Ensure that any contract over the College’s threshold ($150,000) follow the sealed bid requirements listed in 2 CFR Section 200.320b1. View of Responsible Officials: The College concurs with this finding.
2022-004 — Procurement – Material Weakness in Internal Control Over Compliance and Noncompliance Federal program information: Funding agencies: U.S. Department of Interior and U.S. Department of Education Titles: Assistance to Tribally Controlled Community Colleges; Higher Education Institutional Aid; and Education Stabilization Fund ALN Number: 15.027, 84.031, and 84.425 Award years: Various Criteria: According to 2 CFR Section 200.318i, the recipient or subrecipient must maintain records sufficient to detail the history of each procurement transaction. These records must include the rationale for the procurement method, contract type selection, contractor selection or rejection, and the basis for the contract price. According to 2 CFR Section 0200.319a, All procurement transactions under the Federal award must be conducted in a manner that provides full and open competition. Condition: The College did not maintain records sufficient to detail the history of each procurement transaction for the nine procurements contracts tested. Cause: The College did not have sufficient procedures in place to ensure that procurement records are maintained. Effect: The College is not in compliance with procurement requirements. Questioned Costs: None Context: Procurement documents were not retained for nine out of nine transactions tested. Recommendation: Formally document and enforce policies and procedures that will promote adequate monitoring of the procurement and bidding process. Ensure that any contract over the College’s threshold ($150,000) follow the sealed bid requirements listed in 2 CFR Section 200.320b1. View of Responsible Officials: The College concurs with this finding.
2022-004 — Procurement – Material Weakness in Internal Control Over Compliance and Noncompliance Federal program information: Funding agencies: U.S. Department of Interior and U.S. Department of Education Titles: Assistance to Tribally Controlled Community Colleges; Higher Education Institutional Aid; and Education Stabilization Fund ALN Number: 15.027, 84.031, and 84.425 Award years: Various Criteria: According to 2 CFR Section 200.318i, the recipient or subrecipient must maintain records sufficient to detail the history of each procurement transaction. These records must include the rationale for the procurement method, contract type selection, contractor selection or rejection, and the basis for the contract price. According to 2 CFR Section 0200.319a, All procurement transactions under the Federal award must be conducted in a manner that provides full and open competition. Condition: The College did not maintain records sufficient to detail the history of each procurement transaction for the nine procurements contracts tested. Cause: The College did not have sufficient procedures in place to ensure that procurement records are maintained. Effect: The College is not in compliance with procurement requirements. Questioned Costs: None Context: Procurement documents were not retained for nine out of nine transactions tested. Recommendation: Formally document and enforce policies and procedures that will promote adequate monitoring of the procurement and bidding process. Ensure that any contract over the College’s threshold ($150,000) follow the sealed bid requirements listed in 2 CFR Section 200.320b1. View of Responsible Officials: The College concurs with this finding.
FA 2022-001 Strengthen Controls over Expenditures Compliance Requirement: Activities Allowed or Unallowed Allowable Costs/Cost Principles Procurement and Suspension and Debarment 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 Number and Title: COVID-19 – 84.425D – Elementary and Secondary School Emergency Relief Fund Federal Award Number: S425D210012 (Year: 2021) Questioned Costs: $189,893 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. 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 $2,439,337 were expended and reported on the Dodge 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. 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 amounts 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…” Additionally, 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 costs, 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 constraints 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. € 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…” Moreover, to assist school districts in improving their financial management systems and associated compliance over federal programs, GaDOE published the Financial Management for Georgia Local Units of Administration (FMGLUA), manual. The FMGLUA manual requires that LEAs submit a budget as part of each federal program’s Consolidated Application process. The program budget reflects details regarding the manner in which each school district intends to expend the program funds. The Consolidated Application, including the budget, for each program must be reviewed and approved by GaDOE personnel before the LEA is authorized to expend program funds. Amendments to the budget are to be submitted to and approved by GaDOE when a school district intends to spend funds in a manner not initially reported. Lastly, LEA personnel must also provide for specific assurances related to the ESSER program within the Consolidated Application system. These assurances are reflected in the Uniform Guidance, Section 200.415 – Required Certifications, and include provisions that require LEAs “to assure that expenditures are proper and in accordance with the terms and conditions of the Federal award and approved project budgets…” 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. The following deficiencies were identified: • Testing revealed that expenditures totaling $173,893 were not appropriately approved by GaDOE through the Consolidated Application system. Further, the expenditures were not submitted for approval on an amended budget as of the end of audit fieldwork. • Testing revealed that a payment was made to the janitorial company utilized by the School District to provide “retention” bonuses to janitorial contractors who were not employees of the School District. These individuals were assigned to work within the School District by the private janitorial company. Per review of the contract in place during the fiscal year under review, it was noted that these bonuses represented amounts in excess of the agreed upon price. Furthermore, the School District does not have the authority or ability to retain these individuals as they were not employees of the School District and contract provisions requiring the individuals to remain employed by the janitorial company and in the service of the School District for a stated period of time was not reflected within the associated contract. Therefore, expenditures totaling $16,000 were not considered to be reasonable and necessary for the performance of the ESSER program and deemed unallowable. Questioned Costs: Known questioned costs of $189,893 were identified for expenditures that were not incurred for a necessary and reasonable purpose and did not follow the School District’s and/or GaDOE’s policies and procedures. These known questioned costs related to expenditures that were not tested as part of a sample, and therefore, should not be projected to a population to determine likely questioned costs. Cause: In discussing these deficiencies with management, they stated that they believed that any expenditures not previously approved on the Consolidated Application were still allowable provided that budget amendments were submitted and approved by the GaDOE prior to the end of the grant period. Additionally, they stated that they were not aware that contract amendments should be initiated prior to expending funds in excess of the stated contract rates. Effect: The School District is not in compliance with the Uniform Guidance, ED, 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 strains and shortages as 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 appropriately approved by the GaDOE through the Consolidated Application process and to ensure that expenditures are in line with provisions reflected in the associated contract and or/contract amendments, prior to the expending of federal program funds. In addition, the School District should implement a monitoring process to ensure that all expenditures are compliant with the School District's and GaDOE’s policies and procedures. Views of Responsible Officials: We concur with this finding.
CONDITION: During the payroll testing of 40 premium pay transactions, for all 40 transactions there was no evidence that the County determined that premium pay did not exceed the 150% limitation described in the criteria below. In addition, the County did not identify eligible and non‐eligible employees. CRITERIA: Per 31 CFR Part 35 [RIN I505‐AC77], Coronavirus State and Local Fiscal Recovery Funds (SLRFR), Final Rule and 2 CFR §200.318 (C) elected official are prohibited from using funds to pay themselves premium pay. The Final Rule states SLFRF Funds can be paid for premium pay but those payments can’t increase an employee’s total pay above 150% of their residing state or county’s average annual wage. EFFECT: Premium payments could have been paid in excess of the 150% limitation per the SLFRF Final Ruling. Elected officials, who were deemed ineligible per the SLFRF Final Rule, were paid premium pay. CAUSE: The County did not establish or apply appropriate internal controls over premium pay payments made to ensure compliance with SLFRF Final Ruling. RECOMMENDATION: We recommend that the County establish appropriate controls over federal monies in the future to ensure compliance with federal grant expenditures prior to the disbursement. MANAGEMENT’S RESPONSE: County Commission gave former County Manager direction to consult with legal counsel to determine premium pay for County staff who worked throughout the Pandemic. A meeting was held between Former County Manager, Financial Specialist, County Sheriff and VMDC Warden to discuss premium pay for all staff as well as public safety recruitment and retention. Former County Manager stated after consulting with County Legal Counsel and NMC General Counsel, all County staff including, Elected Officials were eligible to receive “premium pay” in compliance with the American Rescue Plan Act Rule. Financial Specialist and County Sheriff questioned the eligibility for Elected Officials to receive premium pay referencing N.M. Const. Art IV, section 27 “No law shall be enacted giving any extra compensation to any public officer, servant, agent or contractor after services are rendered or contract made; nor shall the compensation of any officer be increased or diminished during his term of office, except as otherwise provided in this constitution.”, and NMSA 4‐44‐4.1 related to County Elected Official Salary caps. Former County Manager responded premium pay should be issued to all staff including Elected Officials through the accounts payable department instead of payroll to avoid violating New Mexico Constitution and State Statute and premium pay is not considered a salary increase but “premium pay” outside of regular salary paid to “essential workers”. Former County Manager went on to explain that all law enforcement officers were eligible for premium pay because they were described as “essential” within the American Rescue Plan Act Rule. In a regular Commissioner Meeting held on 10/12/2021 Former County Manager presented to Commission and recommended approval of public safety recruitment and retention plan as well as a one‐time payment to current staff of $5,000 who worked from January 2020 through October 2021 and a prorated rate be awarded to any employee that worked a portion of that time. She also stated new information was received that confirms all County employees are eligible for the premium pay, currently 88 employees. She also stated that public health contractors are also eligible for premium pay and recommended payment be made to 2.5 full time positions to contracted health care services provider. Commission approved the request from the Former County Manager based on her recommendation. Former County Manager drafted, reviewed and approved a list of employees scheduled to receive payment including 5 contracted medical service provider including the CEO of the company. Former County Manager directed accounts payable clerk to issue payment through accounts payable. On November 8th 2021, Former County Manager presented to and recommended approval additional premium pay be awarded to Employees that had retired and worked part of the period of January 2020 though October 2021 and two full time Employees that were laid off. In January 2022 Elected Officials requested a meeting be held to discuss the issuing of 1099 forms to employees who received premium pay. Also present in the meeting was Commission Chairman. Elected Officials raised concern that staff was issued a 1099 and questioned if this was correct. Former County Manager informed staff the advice the County got was to issue a 1099‐NEC, under the circumstances. However, upon review of email communication former County Manager received an opinion from her personal Tax Accountant stating that the payments should have been run through payroll and recommended Former County Manager either correct the original error and would require several steps including corrected 941’s and corrected w‐2’s or issue a 1099 NEC. Former County Manager directed accounts payable clerk to issue a 1099 NEC. Commission Chairman questioned several expenditures from American Rescue Plan Act Fund, including the additional 2 full time positions and CEO of the company not approved by Commission, it was later determined that several expenditures were not allowable under the American Rescue Plan Act Fund Rule. Colfax County Staff submitted written report to Office of the State Auditor as required under NMSA 1978, Section 12‐6‐6 (criminal violations) an agency or auditor shall notify the state auditor immediately, in writing upon discovery of any violations of criminal statute in connection with financial affairs. Former County Manager announced her resignation February 28, 2022. It was later discovered through communication with County legal Counsel and NMC General Counsel that Former County Manager mislead the County Commission, Elected Officials, and County Staff and did not consult with County Legal Counsel or NMC General Counsel as previously stated and as directed by the Commission before making recommendations for approval of American Rescue Plan Act Funds. RESPONSIBLE PARTY/TIMELINE TO CORRECT: Finance Director – June 30, 2023
2022-004 — Procurement – Material Weakness in Internal Control Over Compliance and Noncompliance Federal program information: Funding agency: Department of Interior and Department of Education Passed through the Bureau of Indian Education (BIE) Title: Indian School Equalization Program (ISEP) Education Stabilization Fund (ESF) CFDA number: 15.042 and 84.425 Award number: All major program award numbers Award period: All major program periods Criteria: The Uniform Guidance 2 CFR 200.318-200.326 require verification of suspension and debarment as part of the procurement process. Condition: The School was unable to provide any evidence of verification of suspension and debarment on one of the vendors. Questioned Costs: N/A Cause: The School did not retain evidence of verification of suspension and debarment. Effect: The School was unable to provide evidence of verification of suspension and debarment. Auditor’s Recommendations: Evidence of verification of suspension and debarment to be kept. Management’s Response: Although the PILC verifies the suspension and debarment status of every vendor for potential purchases above $150,000, we had not been routinely printing documentation verifying this process. In the future, the School will be printing off evidence of a dated keyword search to demonstrate that a vendor is not listed on the www.SAM.gov suspension/debarment list for procurement purposes.
2022-004 — Procurement – Material Weakness in Internal Control Over Compliance and Noncompliance Federal program information: Funding agency: Department of Interior and Department of Education Passed through the Bureau of Indian Education (BIE) Title: Indian School Equalization Program (ISEP) Education Stabilization Fund (ESF) CFDA number: 15.042 and 84.425 Award number: All major program award numbers Award period: All major program periods Criteria: The Uniform Guidance 2 CFR 200.318-200.326 require verification of suspension and debarment as part of the procurement process. Condition: The School was unable to provide any evidence of verification of suspension and debarment on one of the vendors. Questioned Costs: N/A Cause: The School did not retain evidence of verification of suspension and debarment. Effect: The School was unable to provide evidence of verification of suspension and debarment. Auditor’s Recommendations: Evidence of verification of suspension and debarment to be kept. Management’s Response: Although the PILC verifies the suspension and debarment status of every vendor for potential purchases above $150,000, we had not been routinely printing documentation verifying this process. In the future, the School will be printing off evidence of a dated keyword search to demonstrate that a vendor is not listed on the www.SAM.gov suspension/debarment list for procurement purposes.
2022-004 — Procurement – Material Weakness in Internal Control Over Compliance and Noncompliance Federal program information: Funding agency: Department of Interior and Department of Education Passed through the Bureau of Indian Education (BIE) Title: Indian School Equalization Program (ISEP) Education Stabilization Fund (ESF) CFDA number: 15.042 and 84.425 Award number: All major program award numbers Award period: All major program periods Criteria: The Uniform Guidance 2 CFR 200.318-200.326 require verification of suspension and debarment as part of the procurement process. Condition: The School was unable to provide any evidence of verification of suspension and debarment on one of the vendors. Questioned Costs: N/A Cause: The School did not retain evidence of verification of suspension and debarment. Effect: The School was unable to provide evidence of verification of suspension and debarment. Auditor’s Recommendations: Evidence of verification of suspension and debarment to be kept. Management’s Response: Although the PILC verifies the suspension and debarment status of every vendor for potential purchases above $150,000, we had not been routinely printing documentation verifying this process. In the future, the School will be printing off evidence of a dated keyword search to demonstrate that a vendor is not listed on the www.SAM.gov suspension/debarment list for procurement purposes.
Criteria The Uniform Guidance 2 CFR §200.320 sets forth the methods of procurement to be followed in the acquisition of property or services required under a Federal award or subaward, which includes formal purchase methods such as proposal or bids when the value of the property or services under a Federal financial assistance award exceeds a certain threshold, as defined. Furthermore, 2 CFR §200.320(c) provides specific circumstances in which noncompetitive procurement can be used. Condition During our audit, we noted that the Organization made subawards to entities which were subject to a formal purchase method, for which competitive processes for selection were not performed, nor was documentation of the specific criteria of 2 CFR §200.320(c) met to support noncompetitive procurements maintained. Cause Management had not updated its policies and procedures to incorporate certain pertinent sections of the procurement standards of the Uniform Guidance. Effect The lack of procurement standards in accordance with the Uniform Guidance may result in allowable cost issues. Recommendation We recommend that the Organization incorporate the procurement standards of the Uniform Guidance to its policies and procedures manual to ensure compliance with Federal standards, including 2 CFR §200.318(h) which stipulates that sufficient detail of the history of the procurement must be maintained, including the selection of the contractor. Views of Responsible Officials and Corrective Action The Organization concurs with the recommendation. As part of our current review and revision process, the Organization plans to adopt the 2 CFR §200.320 procurement guidance and develop supporting policies and procedures to ensure compliance with federal standards. Additionally, the Organization will incorporate the standards outlined in 2 CFR §200.318 to further align our operations with Uniform Guidance requirements, reinforcing our commitment to meeting federal compliance standards. The Organization has prioritized the completion and distribution of the updated financial policies and procedures, including the 2 CFR §200.320 procurement guidance by December 31, 2024.
Criteria The Uniform Guidance 2 CFR §200.320 sets forth the methods of procurement to be followed in the acquisition of property or services required under a Federal award or subaward, which includes formal purchase methods such as proposal or bids when the value of the property or services under a Federal financial assistance award exceeds a certain threshold, as defined. Furthermore, 2 CFR §200.320(c) provides specific circumstances in which noncompetitive procurement can be used. Condition During our audit, we noted that the Organization made subawards to entities which were subject to a formal purchase method, for which competitive processes for selection were not performed, nor was documentation of the specific criteria of 2 CFR §200.320(c) met to support noncompetitive procurements maintained. Cause Management had not updated its policies and procedures to incorporate certain pertinent sections of the procurement standards of the Uniform Guidance. Effect The lack of procurement standards in accordance with the Uniform Guidance may result in allowable cost issues. Recommendation We recommend that the Organization incorporate the procurement standards of the Uniform Guidance to its policies and procedures manual to ensure compliance with Federal standards, including 2 CFR §200.318(h) which stipulates that sufficient detail of the history of the procurement must be maintained, including the selection of the contractor. Views of Responsible Officials and Corrective Action The Organization concurs with the recommendation. As part of our current review and revision process, the Organization plans to adopt the 2 CFR §200.320 procurement guidance and develop supporting policies and procedures to ensure compliance with federal standards. Additionally, the Organization will incorporate the standards outlined in 2 CFR §200.318 to further align our operations with Uniform Guidance requirements, reinforcing our commitment to meeting federal compliance standards. The Organization has prioritized the completion and distribution of the updated financial policies and procedures, including the 2 CFR §200.320 procurement guidance by December 31, 2024.
Criteria The Uniform Guidance 2 CFR §200.320 sets forth the methods of procurement to be followed in the acquisition of property or services required under a Federal award or subaward, which includes formal purchase methods such as proposal or bids when the value of the property or services under a Federal financial assistance award exceeds a certain threshold, as defined. Furthermore, 2 CFR §200.320(c) provides specific circumstances in which noncompetitive procurement can be used. Condition During our audit, we noted that the Organization made subawards to entities which were subject to a formal purchase method, for which competitive processes for selection were not performed, nor was documentation of the specific criteria of 2 CFR §200.320(c) met to support noncompetitive procurements maintained. Cause Management had not updated its policies and procedures to incorporate certain pertinent sections of the procurement standards of the Uniform Guidance. Effect The lack of procurement standards in accordance with the Uniform Guidance may result in allowable cost issues. Recommendation We recommend that the Organization incorporate the procurement standards of the Uniform Guidance to its policies and procedures manual to ensure compliance with Federal standards, including 2 CFR §200.318(h) which stipulates that sufficient detail of the history of the procurement must be maintained, including the selection of the contractor. Views of Responsible Officials and Corrective Action The Organization concurs with the recommendation. As part of our current review and revision process, the Organization plans to adopt the 2 CFR §200.320 procurement guidance and develop supporting policies and procedures to ensure compliance with federal standards. Additionally, the Organization will incorporate the standards outlined in 2 CFR §200.318 to further align our operations with Uniform Guidance requirements, reinforcing our commitment to meeting federal compliance standards. The Organization has prioritized the completion and distribution of the updated financial policies and procedures, including the 2 CFR §200.320 procurement guidance by December 31, 2024.
Criteria The Uniform Guidance 2 CFR §200.320 sets forth the methods of procurement to be followed in the acquisition of property or services required under a Federal award or subaward, which includes formal purchase methods such as proposal or bids when the value of the property or services under a Federal financial assistance award exceeds a certain threshold, as defined. Furthermore, 2 CFR §200.320(c) provides specific circumstances in which noncompetitive procurement can be used. Condition During our audit, we noted that the Organization made subawards to entities which were subject to a formal purchase method, for which competitive processes for selection were not performed, nor was documentation of the specific criteria of 2 CFR §200.320(c) met to support noncompetitive procurements maintained. Cause Management had not updated its policies and procedures to incorporate certain pertinent sections of the procurement standards of the Uniform Guidance. Effect The lack of procurement standards in accordance with the Uniform Guidance may result in allowable cost issues. Recommendation We recommend that the Organization incorporate the procurement standards of the Uniform Guidance to its policies and procedures manual to ensure compliance with Federal standards, including 2 CFR §200.318(h) which stipulates that sufficient detail of the history of the procurement must be maintained, including the selection of the contractor. Views of Responsible Officials and Corrective Action The Organization concurs with the recommendation. As part of our current review and revision process, the Organization plans to adopt the 2 CFR §200.320 procurement guidance and develop supporting policies and procedures to ensure compliance with federal standards. Additionally, the Organization will incorporate the standards outlined in 2 CFR §200.318 to further align our operations with Uniform Guidance requirements, reinforcing our commitment to meeting federal compliance standards. The Organization has prioritized the completion and distribution of the updated financial policies and procedures, including the 2 CFR §200.320 procurement guidance by December 31, 2024.