CONDITION: The Cambria Heights School District contracted with a third-party vendor (Trafera) for the purchase of technology equipment. The contract with Trafera was procured through a cooperative purchasing group (COSTARS). The District did not obtain an adequate number of price or rate quotations for the technology equipment as required by the Uniform Guidance and 24 PS 8.807.1. CRITERIA: As specified in Section 2 CFR 200. 318(i) of the Uniform Guidance, the District 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. In addition, small purchase procedures per Section 2 CFR 200.320(a)(2)(i) for acquisitions between the micro-purchase threshold (currently $10,000) and the simplified acquisition threshold (current $250,000), price or rate quotations must be obtained from an adequate number of qualified sources as determined appropriate. Per 24 PS 8.807.1, there should be three quotes that are either written or well documented. The use of COSTARS only constitutes one quotation. CAUSE: School District personnel directly responsible for the acquisition of the technology equipment through COSTARS interpreted that the requirements specified by Section 2 CFR 200.318(i) and Section 2 CFR 200.320(a)(2)(i), would be met by using this cooperative purchasing organization. EFFECT: The School District did not comply with the requirements of 2 CFR 200.318(i) and 2 CFR 200.320(a)(2)(i) of the Uniform Guidance, and 24 PS 8.807.1, regarding maintaining records sufficient to detail the history of procurement for the technology equipment to ensure that an adequate number of price quotations were solicited for this purchase. QUESTIONED COST: $106,250 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 2 CFR.320(a)(2)(i). 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.
Federal Program Information: Funding Agency: U.S Department of Health and Human Services FALN: 93.926 Federal Award Identification Number: H49MC00119‐19‐00 Pass Through Entity: State of Georgia Department of Human Services Award Year: 2018‐:2020 Criteria: Under 2 CFR Section 200.303(a), non‐federal entities must establish and maintain effective internal controls to provide reasonable assurance that the entity is managing the federal awards in compliance with statues, regulations, and the terms and conditions of the award. Additionally, under 2 CFR Section 200.320, the Organization must have and use documented procurement procedures for acquisition of property and services under a federal award or a sub‐award. Condition: The Organization does have approved policies and procedures over procurement that meet the requirements of the Uniform Guidance. However the Organization is not following its prescribed policies and procedures. The Organization lacked supporting documentation verifying procurement policies and procedures were followed. Due to lack of supporting documentation, procurement could not be verified. Of the sixty (60) transactions examined, ten (10) lacked supporting documentation for review of procurement. Effect: Not following procurement policies and procedures may result in funds to be returned back to grantor and/or impact future funding. Cause: Supporting procurement documentation for acquisition of property and services were not properly maintained in part due to several changes in personnel within the accounting area and overall limited number of personnel for certain functions and lack of board oversight. Questioned Costs: Known questioned costs of $3,870 and likely questioned costs of $17,206 for Healthy Start. Recommendation: We recommend the Organization strengthen its policies and procedures to ensure procurement is adequately documented for that goods and services purchased in accordance with Uniform Guidance and other federal guidelines.
Federal Program Information: Funding Agency: U.S Department of Health and Human Services FALN: 93.926 Federal Award Identification Number: H49MC00119‐19‐00 Pass Through Entity: State of Georgia Department of Human Services Award Year: 2018‐:2020 Criteria: Under 2 CFR Section 200.303(a), non‐federal entities must establish and maintain effective internal controls to provide reasonable assurance that the entity is managing the federal awards in compliance with statues, regulations, and the terms and conditions of the award. Additionally, under 2 CFR Section 200.320, the Organization must have and use documented procurement procedures for acquisition of property and services under a federal award or a sub‐award. Condition: The Organization does have approved policies and procedures over procurement that meet the requirements of the Uniform Guidance. However the Organization is not following its prescribed policies and procedures. The Organization lacked supporting documentation verifying procurement policies and procedures were followed. Due to lack of supporting documentation, procurement could not be verified. Of the sixty (60) transactions examined, ten (10) lacked supporting documentation for review of procurement. Effect: Not following procurement policies and procedures may result in funds to be returned back to grantor and/or impact future funding. Cause: Supporting procurement documentation for acquisition of property and services were not properly maintained in part due to several changes in personnel within the accounting area and overall limited number of personnel for certain functions and lack of board oversight. Questioned Costs: Known questioned costs of $3,870 and likely questioned costs of $17,206 for Healthy Start. Recommendation: We recommend the Organization strengthen its policies and procedures to ensure procurement is adequately documented for that goods and services purchased in accordance with Uniform Guidance and other federal guidelines.
Federal Program Information: Funding Agency: U.S Department of Health and Human Services FALN: 93.926 Federal Award Identification Number: H49MC00119‐19‐00 Pass Through Entity: State of Georgia Department of Human Services Award Year: 2018‐:2020 Criteria: Under 2 CFR Section 200.303(a), non‐federal entities must establish and maintain effective internal controls to provide reasonable assurance that the entity is managing the federal awards in compliance with statues, regulations, and the terms and conditions of the award. Additionally, under 2 CFR Section 200.320, the Organization must have and use documented procurement procedures for acquisition of property and services under a federal award or a sub‐award. Condition: The Organization does have approved policies and procedures over procurement that meet the requirements of the Uniform Guidance. However the Organization is not following its prescribed policies and procedures. The Organization lacked supporting documentation verifying procurement policies and procedures were followed. Due to lack of supporting documentation, procurement could not be verified. Of the sixty (60) transactions examined, ten (10) lacked supporting documentation for review of procurement. Effect: Not following procurement policies and procedures may result in funds to be returned back to grantor and/or impact future funding. Cause: Supporting procurement documentation for acquisition of property and services were not properly maintained in part due to several changes in personnel within the accounting area and overall limited number of personnel for certain functions and lack of board oversight. Questioned Costs: Known questioned costs of $3,870 and likely questioned costs of $17,206 for Healthy Start. Recommendation: We recommend the Organization strengthen its policies and procedures to ensure procurement is adequately documented for that goods and services purchased in accordance with Uniform Guidance and other federal guidelines.
Federal Program Information: Funding Agency: U.S Department of Health and Human Services FALN: 93.926 Federal Award Identification Number: H49MC00119‐19‐00 Pass Through Entity: State of Georgia Department of Human Services Award Year: 2018‐:2020 Criteria: Under 2 CFR Section 200.303(a), non‐federal entities must establish and maintain effective internal controls to provide reasonable assurance that the entity is managing the federal awards in compliance with statues, regulations, and the terms and conditions of the award. Additionally, under 2 CFR Section 200.320, the Organization must have and use documented procurement procedures for acquisition of property and services under a federal award or a sub‐award. Condition: The Organization does have approved policies and procedures over procurement that meet the requirements of the Uniform Guidance. However the Organization is not following its prescribed policies and procedures. The Organization lacked supporting documentation verifying procurement policies and procedures were followed. Due to lack of supporting documentation, procurement could not be verified. Of the sixty (60) transactions examined, ten (10) lacked supporting documentation for review of procurement. Effect: Not following procurement policies and procedures may result in funds to be returned back to grantor and/or impact future funding. Cause: Supporting procurement documentation for acquisition of property and services were not properly maintained in part due to several changes in personnel within the accounting area and overall limited number of personnel for certain functions and lack of board oversight. Questioned Costs: Known questioned costs of $3,870 and likely questioned costs of $17,206 for Healthy Start. Recommendation: We recommend the Organization strengthen its policies and procedures to ensure procurement is adequately documented for that goods and services purchased in accordance with Uniform Guidance and other federal guidelines.
Finding 2018-002 – Lack of Policies/Procedures & Documentation Related to Procurement/Suspension and Debarment (Material Weakness in Internal Controls over Compliance – Federal Program CFDA 10.766/10.780 Community Facilities Loans and Grants Cluster) Criteria: 2 CFR 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, £200.318 requires that the auditee must have and use documented procurement procedures for the purchase/acquisition of any property or services under a Federal award. These must include written standards of conduct covering conflicts of interest, consideration of the most economical purchase, rationale for the method of procurement, selection of contractors including whether they have been barred from doing business with the federal government, and the basis for the contract price. Also, £200.319 requires all procurement transactions be conducted in a manner that provides full and open competition, and develop specific procurement methods in compliance with £200.320, “Methods of procurement to be followed.” Condition and Context: The Organization has no documented procedures over the procurement process, contractor selection, or established methods in place to assure free and open competition as required by the Procurement Standards contained in the Uniform Guidance. Cause: Lack of understanding relating to the requirements of federal awards and loans considered to be financial assistance under the Uniform Guidance. Effect: Lack of documented controls over the Organization’s procurement process creates a material weakness in internal controls over compliance. Questioned Costs: None Recommendation: Management should become familiar with the Uniform Guidance, and in particular, the application section on Procurement, and seek additional training for those staff involved in all phases of the procurement process. Views of Responsible Officials and Planned Corrective Actions: We are creating a job description for a financial analyst. Part of this role will be to implement the recommendation, including development of bid specifications, participation in the selection of supplies and contractors, and monitoring/documenting results.
Finding 2018-002 – Lack of Policies/Procedures & Documentation Related to Procurement/Suspension and Debarment (Material Weakness in Internal Controls over Compliance – Federal Program CFDA 10.766/10.780 Community Facilities Loans and Grants Cluster) Criteria: 2 CFR 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, £200.318 requires that the auditee must have and use documented procurement procedures for the purchase/acquisition of any property or services under a Federal award. These must include written standards of conduct covering conflicts of interest, consideration of the most economical purchase, rationale for the method of procurement, selection of contractors including whether they have been barred from doing business with the federal government, and the basis for the contract price. Also, £200.319 requires all procurement transactions be conducted in a manner that provides full and open competition, and develop specific procurement methods in compliance with £200.320, “Methods of procurement to be followed.” Condition and Context: The Organization has no documented procedures over the procurement process, contractor selection, or established methods in place to assure free and open competition as required by the Procurement Standards contained in the Uniform Guidance. Cause: Lack of understanding relating to the requirements of federal awards and loans considered to be financial assistance under the Uniform Guidance. Effect: Lack of documented controls over the Organization’s procurement process creates a material weakness in internal controls over compliance. Questioned Costs: None Recommendation: Management should become familiar with the Uniform Guidance, and in particular, the application section on Procurement, and seek additional training for those staff involved in all phases of the procurement process. Views of Responsible Officials and Planned Corrective Actions: We are creating a job description for a financial analyst. Part of this role will be to implement the recommendation, including development of bid specifications, participation in the selection of supplies and contractors, and monitoring/documenting results.