2022-001 Finding: Special Tests - Wage Rate Requirements Federal Assistance Listing Number 84.425, 84.425D and 84.425C - COVID-19 Elementary and Secondary School Emergency Fund (ESSER) Passed-through Indiana Department of Education Award Numbers - 2021-2022; S425D200 013; S425U200 13; and S425C200 18 Criteria: All laborers and mechanics employed by contractors or subcontractors to work on construction contracts in excess of $2,000 financed by Federal assistance funds must be paid wages not less than those established for the locality of the project (prevailing wage rates) by the Department of Labor (DOL) (40 USC 3141?3144, 3146, and 3147). Non-Federal entities shall include in their construction contracts subject to the Wage Rate Requirements (which still may be referenced as the Davis-Bacon Act) a provision that the contractor or subcontractor comply with those requirements and the DOL regulations. This includes a requirement for the contractor or subcontractor to submit to the Non-Federal entity weekly, for each week in which any contract work is performed, a copy of the payroll and a statement of compliance (certified payrolls). (29 CFR sections 5.5 and 5.6; the A-102 Common Rule (section 36(i)(5)); OMB Circular A-110 (2 CFR Part 215, Appendix A, Contract Provisions); 2 CFR Part 176, Subpart C; and 2 CFR section 200.326). In addition, according to 2 CFR Part 200.303, the non-Federal entity must 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. Condition: The School Corporation did not obtain certified payrolls for contractor or subcontractor work performed during the fiscal year ended June 30, 2022. Questioned Costs: Unknown. "Context: There were multiple construction projects charged to the grant during the year. Three of 23 contractors assigned to these projects were tested and the following was noted: - The School Corporation did not obtain any certified payrolls for the contractor and subcontractors tested." Effect: Certified Payrolls were not obtained or reviewed for the project so laborers and mechanics employed by contractors or subcontractors may not have been paid prevailing wage rates. Cause: The School Corporation was aware of the wage rate requirements as it applied to this grant; however they indicated to contractors and subcontractors that payroll information only need be submitted if requested. The School Corporation did not request this information. Identification as a Repeat Finding: Not applicable. Recommendation: We recommend the School Corporation implement a compliance review process over wage rate requirements, including facilities staff on-site weekly where projects are occurring to determine if work was completed towards the project, tracking certified payrolls or notification of no work performed and reviewing to help ensure wages are equal to or in excess of the prevailing wage rates. Views of Responsible Officials: Agree. See separate report for planned corrective actions.
2022-001 Finding: Special Tests - Wage Rate Requirements Federal Assistance Listing Number 84.425, 84.425D and 84.425C - COVID-19 Elementary and Secondary School Emergency Fund (ESSER) Passed-through Indiana Department of Education Award Numbers - 2021-2022; S425D200 013; S425U200 13; and S425C200 18 Criteria: All laborers and mechanics employed by contractors or subcontractors to work on construction contracts in excess of $2,000 financed by Federal assistance funds must be paid wages not less than those established for the locality of the project (prevailing wage rates) by the Department of Labor (DOL) (40 USC 3141?3144, 3146, and 3147). Non-Federal entities shall include in their construction contracts subject to the Wage Rate Requirements (which still may be referenced as the Davis-Bacon Act) a provision that the contractor or subcontractor comply with those requirements and the DOL regulations. This includes a requirement for the contractor or subcontractor to submit to the Non-Federal entity weekly, for each week in which any contract work is performed, a copy of the payroll and a statement of compliance (certified payrolls). (29 CFR sections 5.5 and 5.6; the A-102 Common Rule (section 36(i)(5)); OMB Circular A-110 (2 CFR Part 215, Appendix A, Contract Provisions); 2 CFR Part 176, Subpart C; and 2 CFR section 200.326). In addition, according to 2 CFR Part 200.303, the non-Federal entity must 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. Condition: The School Corporation did not obtain certified payrolls for contractor or subcontractor work performed during the fiscal year ended June 30, 2022. Questioned Costs: Unknown. "Context: There were multiple construction projects charged to the grant during the year. Three of 23 contractors assigned to these projects were tested and the following was noted: - The School Corporation did not obtain any certified payrolls for the contractor and subcontractors tested." Effect: Certified Payrolls were not obtained or reviewed for the project so laborers and mechanics employed by contractors or subcontractors may not have been paid prevailing wage rates. Cause: The School Corporation was aware of the wage rate requirements as it applied to this grant; however they indicated to contractors and subcontractors that payroll information only need be submitted if requested. The School Corporation did not request this information. Identification as a Repeat Finding: Not applicable. Recommendation: We recommend the School Corporation implement a compliance review process over wage rate requirements, including facilities staff on-site weekly where projects are occurring to determine if work was completed towards the project, tracking certified payrolls or notification of no work performed and reviewing to help ensure wages are equal to or in excess of the prevailing wage rates. Views of Responsible Officials: Agree. See separate report for planned corrective actions.
2022-001 Finding: Special Tests - Wage Rate Requirements Federal Assistance Listing Number 84.425, 84.425D and 84.425C - COVID-19 Elementary and Secondary School Emergency Fund (ESSER) Passed-through Indiana Department of Education Award Numbers - 2021-2022; S425D200 013; S425U200 13; and S425C200 18 Criteria: All laborers and mechanics employed by contractors or subcontractors to work on construction contracts in excess of $2,000 financed by Federal assistance funds must be paid wages not less than those established for the locality of the project (prevailing wage rates) by the Department of Labor (DOL) (40 USC 3141?3144, 3146, and 3147). Non-Federal entities shall include in their construction contracts subject to the Wage Rate Requirements (which still may be referenced as the Davis-Bacon Act) a provision that the contractor or subcontractor comply with those requirements and the DOL regulations. This includes a requirement for the contractor or subcontractor to submit to the Non-Federal entity weekly, for each week in which any contract work is performed, a copy of the payroll and a statement of compliance (certified payrolls). (29 CFR sections 5.5 and 5.6; the A-102 Common Rule (section 36(i)(5)); OMB Circular A-110 (2 CFR Part 215, Appendix A, Contract Provisions); 2 CFR Part 176, Subpart C; and 2 CFR section 200.326). In addition, according to 2 CFR Part 200.303, the non-Federal entity must 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. Condition: The School Corporation did not obtain certified payrolls for contractor or subcontractor work performed during the fiscal year ended June 30, 2022. Questioned Costs: Unknown. "Context: There were multiple construction projects charged to the grant during the year. Three of 23 contractors assigned to these projects were tested and the following was noted: - The School Corporation did not obtain any certified payrolls for the contractor and subcontractors tested." Effect: Certified Payrolls were not obtained or reviewed for the project so laborers and mechanics employed by contractors or subcontractors may not have been paid prevailing wage rates. Cause: The School Corporation was aware of the wage rate requirements as it applied to this grant; however they indicated to contractors and subcontractors that payroll information only need be submitted if requested. The School Corporation did not request this information. Identification as a Repeat Finding: Not applicable. Recommendation: We recommend the School Corporation implement a compliance review process over wage rate requirements, including facilities staff on-site weekly where projects are occurring to determine if work was completed towards the project, tracking certified payrolls or notification of no work performed and reviewing to help ensure wages are equal to or in excess of the prevailing wage rates. Views of Responsible Officials: Agree. See separate report for planned corrective actions.
2022-001 Finding: Special Tests - Wage Rate Requirements Federal Assistance Listing Number 84.425, 84.425D and 84.425C - COVID-19 Elementary and Secondary School Emergency Fund (ESSER) Passed-through Indiana Department of Education Award Numbers - 2021-2022; S425D200 013; S425U200 13; and S425C200 18 Criteria: All laborers and mechanics employed by contractors or subcontractors to work on construction contracts in excess of $2,000 financed by Federal assistance funds must be paid wages not less than those established for the locality of the project (prevailing wage rates) by the Department of Labor (DOL) (40 USC 3141?3144, 3146, and 3147). Non-Federal entities shall include in their construction contracts subject to the Wage Rate Requirements (which still may be referenced as the Davis-Bacon Act) a provision that the contractor or subcontractor comply with those requirements and the DOL regulations. This includes a requirement for the contractor or subcontractor to submit to the Non-Federal entity weekly, for each week in which any contract work is performed, a copy of the payroll and a statement of compliance (certified payrolls). (29 CFR sections 5.5 and 5.6; the A-102 Common Rule (section 36(i)(5)); OMB Circular A-110 (2 CFR Part 215, Appendix A, Contract Provisions); 2 CFR Part 176, Subpart C; and 2 CFR section 200.326). In addition, according to 2 CFR Part 200.303, the non-Federal entity must 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. Condition: The School Corporation did not obtain certified payrolls for contractor or subcontractor work performed during the fiscal year ended June 30, 2022. Questioned Costs: Unknown. "Context: There were multiple construction projects charged to the grant during the year. Three of 23 contractors assigned to these projects were tested and the following was noted: - The School Corporation did not obtain any certified payrolls for the contractor and subcontractors tested." Effect: Certified Payrolls were not obtained or reviewed for the project so laborers and mechanics employed by contractors or subcontractors may not have been paid prevailing wage rates. Cause: The School Corporation was aware of the wage rate requirements as it applied to this grant; however they indicated to contractors and subcontractors that payroll information only need be submitted if requested. The School Corporation did not request this information. Identification as a Repeat Finding: Not applicable. Recommendation: We recommend the School Corporation implement a compliance review process over wage rate requirements, including facilities staff on-site weekly where projects are occurring to determine if work was completed towards the project, tracking certified payrolls or notification of no work performed and reviewing to help ensure wages are equal to or in excess of the prevailing wage rates. Views of Responsible Officials: Agree. See separate report for planned corrective actions.
2022-001 Finding: Special Tests - Wage Rate Requirements Federal Assistance Listing Number 84.425, 84.425D and 84.425C - COVID-19 Elementary and Secondary School Emergency Fund (ESSER) Passed-through Indiana Department of Education Award Numbers - 2021-2022; S425D200 013; S425U200 13; and S425C200 18 Criteria: All laborers and mechanics employed by contractors or subcontractors to work on construction contracts in excess of $2,000 financed by Federal assistance funds must be paid wages not less than those established for the locality of the project (prevailing wage rates) by the Department of Labor (DOL) (40 USC 3141?3144, 3146, and 3147). Non-Federal entities shall include in their construction contracts subject to the Wage Rate Requirements (which still may be referenced as the Davis-Bacon Act) a provision that the contractor or subcontractor comply with those requirements and the DOL regulations. This includes a requirement for the contractor or subcontractor to submit to the Non-Federal entity weekly, for each week in which any contract work is performed, a copy of the payroll and a statement of compliance (certified payrolls). (29 CFR sections 5.5 and 5.6; the A-102 Common Rule (section 36(i)(5)); OMB Circular A-110 (2 CFR Part 215, Appendix A, Contract Provisions); 2 CFR Part 176, Subpart C; and 2 CFR section 200.326). In addition, according to 2 CFR Part 200.303, the non-Federal entity must 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. Condition: The School Corporation did not obtain certified payrolls for contractor or subcontractor work performed during the fiscal year ended June 30, 2022. Questioned Costs: Unknown. "Context: There were multiple construction projects charged to the grant during the year. Three of 23 contractors assigned to these projects were tested and the following was noted: - The School Corporation did not obtain any certified payrolls for the contractor and subcontractors tested." Effect: Certified Payrolls were not obtained or reviewed for the project so laborers and mechanics employed by contractors or subcontractors may not have been paid prevailing wage rates. Cause: The School Corporation was aware of the wage rate requirements as it applied to this grant; however they indicated to contractors and subcontractors that payroll information only need be submitted if requested. The School Corporation did not request this information. Identification as a Repeat Finding: Not applicable. Recommendation: We recommend the School Corporation implement a compliance review process over wage rate requirements, including facilities staff on-site weekly where projects are occurring to determine if work was completed towards the project, tracking certified payrolls or notification of no work performed and reviewing to help ensure wages are equal to or in excess of the prevailing wage rates. Views of Responsible Officials: Agree. See separate report for planned corrective actions.
Finding 2022-001: Wage Rate Requirements Program Name: Education Stabilization Fund ? Assistance Listing 84.425D & 84.425U Awarding Agency: U.S. Department of Education, passed through Louisiana Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material instance of Non-compliance Questioned Costs: $288,517 for 84.425D and $56,627 for 84.425U. Total questioned cost is $345,144 for the program. Context / Criteria: 2 CFR 200.303(a) requires non-federal entities to establish and maintain internal controls over compliance with federal statutes, laws, and the terms and conditions of grant agreements. 2CFR Part 176, Subpart C requires all laborers and mechanics employed by contractors and subcontractors on projects funded with federal awards to be paid wages at rates not less than those prevailing on projects of a character similar in the locality as determined by the Secretary of Labor in accordance with subchapter IV of Chapter 31 of Title 40, United States Code. This includes a requirement for the contractor to submit to the non-federal entity weekly, for each week in which any contract work is performed, a copy of the payroll and a statement of compliance (certified payrolls). Condition: The School District did not have controls in place to ensure construction contracts in excess of $2,000 included provisions for compliance with the Davis-Bacon Act. The School District did not obtain weekly certified payrolls from contractors for each week in which any contract work was performed. Cause / Effect: The School District entered into a contract with a construction manager for a project not funded by federal funds. Subsequent to the effective date of the contract, the School District began to utilize federal funds for payment of the contract. The contract was not amended to comply with the provisions of the Davis-Bacon Act. As a result, the School District was not in compliance with 29 CFR sections 5.5 and 5.6; the A-102 Common Rule (section 36(i)(5)); OMB Circular A-110 (2 CFR Part 215, Appendix A, Contract Provisions); 2 CFR Part 176, Subpart C; and 2 CFR section 200.326. Recommendation: We recommend management implement procedures to ensure construction contracts entered into that utilize federal funding are reviewed for compliance with federal requirements Views of Responsible Officials and Corrective actions: Management is in agreement with the finding. See accompanying Corrective Action Plan.
Finding 2022-001: Wage Rate Requirements Program Name: Education Stabilization Fund ? Assistance Listing 84.425D & 84.425U Awarding Agency: U.S. Department of Education, passed through Louisiana Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material instance of Non-compliance Questioned Costs: $288,517 for 84.425D and $56,627 for 84.425U. Total questioned cost is $345,144 for the program. Context / Criteria: 2 CFR 200.303(a) requires non-federal entities to establish and maintain internal controls over compliance with federal statutes, laws, and the terms and conditions of grant agreements. 2CFR Part 176, Subpart C requires all laborers and mechanics employed by contractors and subcontractors on projects funded with federal awards to be paid wages at rates not less than those prevailing on projects of a character similar in the locality as determined by the Secretary of Labor in accordance with subchapter IV of Chapter 31 of Title 40, United States Code. This includes a requirement for the contractor to submit to the non-federal entity weekly, for each week in which any contract work is performed, a copy of the payroll and a statement of compliance (certified payrolls). Condition: The School District did not have controls in place to ensure construction contracts in excess of $2,000 included provisions for compliance with the Davis-Bacon Act. The School District did not obtain weekly certified payrolls from contractors for each week in which any contract work was performed. Cause / Effect: The School District entered into a contract with a construction manager for a project not funded by federal funds. Subsequent to the effective date of the contract, the School District began to utilize federal funds for payment of the contract. The contract was not amended to comply with the provisions of the Davis-Bacon Act. As a result, the School District was not in compliance with 29 CFR sections 5.5 and 5.6; the A-102 Common Rule (section 36(i)(5)); OMB Circular A-110 (2 CFR Part 215, Appendix A, Contract Provisions); 2 CFR Part 176, Subpart C; and 2 CFR section 200.326. Recommendation: We recommend management implement procedures to ensure construction contracts entered into that utilize federal funding are reviewed for compliance with federal requirements Views of Responsible Officials and Corrective actions: Management is in agreement with the finding. See accompanying Corrective Action Plan.
Finding 2022-001: Wage Rate Requirements Program Name: Education Stabilization Fund ? Assistance Listing 84.425D & 84.425U Awarding Agency: U.S. Department of Education, passed through Louisiana Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material instance of Non-compliance Questioned Costs: $288,517 for 84.425D and $56,627 for 84.425U. Total questioned cost is $345,144 for the program. Context / Criteria: 2 CFR 200.303(a) requires non-federal entities to establish and maintain internal controls over compliance with federal statutes, laws, and the terms and conditions of grant agreements. 2CFR Part 176, Subpart C requires all laborers and mechanics employed by contractors and subcontractors on projects funded with federal awards to be paid wages at rates not less than those prevailing on projects of a character similar in the locality as determined by the Secretary of Labor in accordance with subchapter IV of Chapter 31 of Title 40, United States Code. This includes a requirement for the contractor to submit to the non-federal entity weekly, for each week in which any contract work is performed, a copy of the payroll and a statement of compliance (certified payrolls). Condition: The School District did not have controls in place to ensure construction contracts in excess of $2,000 included provisions for compliance with the Davis-Bacon Act. The School District did not obtain weekly certified payrolls from contractors for each week in which any contract work was performed. Cause / Effect: The School District entered into a contract with a construction manager for a project not funded by federal funds. Subsequent to the effective date of the contract, the School District began to utilize federal funds for payment of the contract. The contract was not amended to comply with the provisions of the Davis-Bacon Act. As a result, the School District was not in compliance with 29 CFR sections 5.5 and 5.6; the A-102 Common Rule (section 36(i)(5)); OMB Circular A-110 (2 CFR Part 215, Appendix A, Contract Provisions); 2 CFR Part 176, Subpart C; and 2 CFR section 200.326. Recommendation: We recommend management implement procedures to ensure construction contracts entered into that utilize federal funding are reviewed for compliance with federal requirements Views of Responsible Officials and Corrective actions: Management is in agreement with the finding. See accompanying Corrective Action Plan.
Finding 2022-001: Wage Rate Requirements Program Name: Education Stabilization Fund ? Assistance Listing 84.425D & 84.425U Awarding Agency: U.S. Department of Education, passed through Louisiana Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material instance of Non-compliance Questioned Costs: $288,517 for 84.425D and $56,627 for 84.425U. Total questioned cost is $345,144 for the program. Context / Criteria: 2 CFR 200.303(a) requires non-federal entities to establish and maintain internal controls over compliance with federal statutes, laws, and the terms and conditions of grant agreements. 2CFR Part 176, Subpart C requires all laborers and mechanics employed by contractors and subcontractors on projects funded with federal awards to be paid wages at rates not less than those prevailing on projects of a character similar in the locality as determined by the Secretary of Labor in accordance with subchapter IV of Chapter 31 of Title 40, United States Code. This includes a requirement for the contractor to submit to the non-federal entity weekly, for each week in which any contract work is performed, a copy of the payroll and a statement of compliance (certified payrolls). Condition: The School District did not have controls in place to ensure construction contracts in excess of $2,000 included provisions for compliance with the Davis-Bacon Act. The School District did not obtain weekly certified payrolls from contractors for each week in which any contract work was performed. Cause / Effect: The School District entered into a contract with a construction manager for a project not funded by federal funds. Subsequent to the effective date of the contract, the School District began to utilize federal funds for payment of the contract. The contract was not amended to comply with the provisions of the Davis-Bacon Act. As a result, the School District was not in compliance with 29 CFR sections 5.5 and 5.6; the A-102 Common Rule (section 36(i)(5)); OMB Circular A-110 (2 CFR Part 215, Appendix A, Contract Provisions); 2 CFR Part 176, Subpart C; and 2 CFR section 200.326. Recommendation: We recommend management implement procedures to ensure construction contracts entered into that utilize federal funding are reviewed for compliance with federal requirements Views of Responsible Officials and Corrective actions: Management is in agreement with the finding. See accompanying Corrective Action Plan.
Finding 2022-001: Wage Rate Requirements Program Name: Education Stabilization Fund ? Assistance Listing 84.425D & 84.425U Awarding Agency: U.S. Department of Education, passed through Louisiana Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material instance of Non-compliance Questioned Costs: $288,517 for 84.425D and $56,627 for 84.425U. Total questioned cost is $345,144 for the program. Context / Criteria: 2 CFR 200.303(a) requires non-federal entities to establish and maintain internal controls over compliance with federal statutes, laws, and the terms and conditions of grant agreements. 2CFR Part 176, Subpart C requires all laborers and mechanics employed by contractors and subcontractors on projects funded with federal awards to be paid wages at rates not less than those prevailing on projects of a character similar in the locality as determined by the Secretary of Labor in accordance with subchapter IV of Chapter 31 of Title 40, United States Code. This includes a requirement for the contractor to submit to the non-federal entity weekly, for each week in which any contract work is performed, a copy of the payroll and a statement of compliance (certified payrolls). Condition: The School District did not have controls in place to ensure construction contracts in excess of $2,000 included provisions for compliance with the Davis-Bacon Act. The School District did not obtain weekly certified payrolls from contractors for each week in which any contract work was performed. Cause / Effect: The School District entered into a contract with a construction manager for a project not funded by federal funds. Subsequent to the effective date of the contract, the School District began to utilize federal funds for payment of the contract. The contract was not amended to comply with the provisions of the Davis-Bacon Act. As a result, the School District was not in compliance with 29 CFR sections 5.5 and 5.6; the A-102 Common Rule (section 36(i)(5)); OMB Circular A-110 (2 CFR Part 215, Appendix A, Contract Provisions); 2 CFR Part 176, Subpart C; and 2 CFR section 200.326. Recommendation: We recommend management implement procedures to ensure construction contracts entered into that utilize federal funding are reviewed for compliance with federal requirements Views of Responsible Officials and Corrective actions: Management is in agreement with the finding. See accompanying Corrective Action Plan.
2022-003 Prevailing Wage Rate Internal Control and Compliance CFDA Title: ESSER II CFDA Number: 84.425D Federal Award Number: 036-0648-92-2021 Federal Agency: U.S. Department of Education Pass-through Entity: Montana Office of Public Instruction Condition: The District did not require a contract indicating the requirement of prevailing wage rate and weekly certified payrolls submitted for federal construction project with contractor. Context: During the testing of expenditures for the ESSER projects we noted construction projects with labor in excess of $2,000. Criteria: All laborers and mechanics employed by contractors or subcontractors to work on construction contracts in excess of $2,000 financed by federal assistance funds must be paid wages not less than those established for the locality of the project (prevailing wage rates) by the Department of Labor (DOL) (40 USC 3141--3144, 3146, and 3147. Nonfederal entities shall include in their construction contracts subject to the Wage Rate Requirements (which still may be referenced as the Davis-Bacon Act) a provision that the contractor or subcontractor comply with those requirements and the DOL regulations (29 CFR Part 5, Labor Standards Provisions Applicable to Contacts Governing Federally Financed and Assisted Construction). This includes a requirement for the contractor or subcontractor to submit to the nonfederal entity weekly, for each week in which any contract work is performed, a copy of the payroll and a statement of compliance (certified payrolls) (29 CFR sections 5.5 and 5.6; the A-102 Common Rule (section 36(i)(5)); OMB Circular A-110 (2 CFR Part 215, Appendix A, Contract Provisions); 2 CFR Part 176, Subpart C; and 2 CFR section 200.326). Effect: The District was not in compliance with the prevailing wage rate requirement and the internal control system of the District did not identify the need for the compliance. Cause: Internal control procedures were not in place to ensure a contract was draw up to include the prevailing wage rate clause and to ensure the weekly certified payrolls were submitted to the District. Recommendation: The District should implement internal control procedures for any construction contracts in excess of $2,000 funded with federal monies include a contract with the prevailing wage rate clause and submission of weekly certified payrolls.
2022-005 Failure to Comply with Procurement Policy Finding Type: Material Weakness in Internal Control over Major Programs CFDA#: 84.031B Title III Part B, Strengthening Historically Black Colleges and Universities Award Year: 2022 CFDA#: 84.425E/84.425F/84.425J CARES Act: Higher Education Emergency Relief Fund (HEERF) Award Year: 2022 Criteria: The terms of the programs and Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), requires the use of purchase requisitions for all non-exempt purchases. With certain exceptions for sole source and emergencies, the following must be attached to the purchase requisition: Under current procedures, competitive quotes must be obtained as a prerequisite for purchases over $500. The current policy also does not meet the minimum requirement for purchases exceeding the simplified acquisition threshold (greater than $250,000). Condition: The College did not follow its procurement policy for the year ended June 30, 2022. We found that disbursements over $500 did not have competitive quotes when required. Effect of Condition and Questioned Costs: The College has not complied with its procurement policy, and it is not known whether the College has paid a reasonable and competitive rate for the services provided on the various contracts. The dollar amount of the contracts totaled $821,643 for Title III and $74,455 for HEERF. Cause: There was a lack of appropriate internal control policies and procedures implemented at the College during the fiscal year to ensure procurement policies and procedures were performed before disbursement of funds occurred. There is also a lack of understanding of minimum requirements to ensure the College?s policy meets the standards as noted above. Recommendation: We recommended updating the procurement policy to align with the procurement standards set out at 2 CFR sections 200.318 through 200.326 and management be familiar with polices and ensure they are being adhered to. View of Responsible Officials and Planned Corrective Action: The College agrees with the finding and management will take necessary steps to adhere to and update the procurement policy.
2022-005 Failure to Comply with Procurement Policy Finding Type: Material Weakness in Internal Control over Major Programs CFDA#: 84.031B Title III Part B, Strengthening Historically Black Colleges and Universities Award Year: 2022 CFDA#: 84.425E/84.425F/84.425J CARES Act: Higher Education Emergency Relief Fund (HEERF) Award Year: 2022 Criteria: The terms of the programs and Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), requires the use of purchase requisitions for all non-exempt purchases. With certain exceptions for sole source and emergencies, the following must be attached to the purchase requisition: Under current procedures, competitive quotes must be obtained as a prerequisite for purchases over $500. The current policy also does not meet the minimum requirement for purchases exceeding the simplified acquisition threshold (greater than $250,000). Condition: The College did not follow its procurement policy for the year ended June 30, 2022. We found that disbursements over $500 did not have competitive quotes when required. Effect of Condition and Questioned Costs: The College has not complied with its procurement policy, and it is not known whether the College has paid a reasonable and competitive rate for the services provided on the various contracts. The dollar amount of the contracts totaled $821,643 for Title III and $74,455 for HEERF. Cause: There was a lack of appropriate internal control policies and procedures implemented at the College during the fiscal year to ensure procurement policies and procedures were performed before disbursement of funds occurred. There is also a lack of understanding of minimum requirements to ensure the College?s policy meets the standards as noted above. Recommendation: We recommended updating the procurement policy to align with the procurement standards set out at 2 CFR sections 200.318 through 200.326 and management be familiar with polices and ensure they are being adhered to. View of Responsible Officials and Planned Corrective Action: The College agrees with the finding and management will take necessary steps to adhere to and update the procurement policy.
Finding Number: 2022-003 Repeat Finding: Similar to prior year finding 2021-002 Program Name/Assistance Listing Title: Indian School Equalization Program, Special Education Cluster Assistance Listing Number: 15.042, 84.027 Federal Agency: U.S. Department of the Interior, U.S. Department of Education Federal Award Number: A19AV00847 Questioned Costs: None Type of Finding: Noncompliance, Material Weakness Compliance Requirement: Procurement, Suspension and Debarment Criteria: Under 2 CFR ?215.43 the School is required to implement certain procurement policies that adhere to the minimum federal requirements as outlined in 2 CFR ?215.44. 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 ??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. Non-federal entities are prohibited from contracting with or making sub awards under covered transactions to parties that are suspended or debarred. ?Covered transactions? include those procurement contracts for goods and services awarded under a non-procurement transaction that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR ?80.220. Condition: The School did not always follow procurement standards as put forth in 2 CFR ?200.318 through ?200.326. In addition, the School did not verify that covered transactions were made only to entities that were not suspended or debarred or otherwise excluded. Effect: Noncompliance with federal regulation that led to a qualified audit opinion over the listed federal programs as noted above. Cause: Management oversight. Context: For two of 2 vendors in the Formal Procurement Threshold reviewed, the School did not maintain documentation that appropriate procurement procedures were performed. Additionally, for twenty-four of 29 vendors within the Simplified Acquisition Threshold reviewed, the School did not maintain documentation that appropriate procurement procedures were performed. Finally, for four of 21 vendors with at least $25,000 in purchases reviewed, the School did not maintain documentation that a current suspension and debarment check was performed. Recommendation: The School should review its procurement procedures to ensure that proper procurement procedures are performed documentation is maintained to support the procurement. Response: The School concurs with this recommendation and will implement procedures to ensure compliance with federal regulation. Contact person: Dolores Baluyut, Business Manager
Finding Number: 2022-003 Repeat Finding: Similar to prior year finding 2021-002 Program Name/Assistance Listing Title: Indian School Equalization Program, Special Education Cluster Assistance Listing Number: 15.042, 84.027 Federal Agency: U.S. Department of the Interior, U.S. Department of Education Federal Award Number: A19AV00847 Questioned Costs: None Type of Finding: Noncompliance, Material Weakness Compliance Requirement: Procurement, Suspension and Debarment Criteria: Under 2 CFR ?215.43 the School is required to implement certain procurement policies that adhere to the minimum federal requirements as outlined in 2 CFR ?215.44. 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 ??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. Non-federal entities are prohibited from contracting with or making sub awards under covered transactions to parties that are suspended or debarred. ?Covered transactions? include those procurement contracts for goods and services awarded under a non-procurement transaction that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR ?80.220. Condition: The School did not always follow procurement standards as put forth in 2 CFR ?200.318 through ?200.326. In addition, the School did not verify that covered transactions were made only to entities that were not suspended or debarred or otherwise excluded. Effect: Noncompliance with federal regulation that led to a qualified audit opinion over the listed federal programs as noted above. Cause: Management oversight. Context: For two of 2 vendors in the Formal Procurement Threshold reviewed, the School did not maintain documentation that appropriate procurement procedures were performed. Additionally, for twenty-four of 29 vendors within the Simplified Acquisition Threshold reviewed, the School did not maintain documentation that appropriate procurement procedures were performed. Finally, for four of 21 vendors with at least $25,000 in purchases reviewed, the School did not maintain documentation that a current suspension and debarment check was performed. Recommendation: The School should review its procurement procedures to ensure that proper procurement procedures are performed documentation is maintained to support the procurement. Response: The School concurs with this recommendation and will implement procedures to ensure compliance with federal regulation. Contact person: Dolores Baluyut, Business Manager
2022-005 Federal Agency: Department of the Treasury and Federal Communications Commission Federal Program Name: American Rescue Plan Act and Emergency Connectivity Fund Program Assistance Listing Number: 21.027 and 32.009 Federal Award Identification Number and Year: 12060-OPM20600-29669 and ECF202108044 Pass-Through Agency: Office of Policy and Management Pass-Through Number(s): N/A Award Period: 7/1/2021 - 6/30/2022 Type of Finding: ? Significant Deficiency in Internal Control over Compliance ? Other Matters (Noncompliance) Criteria or specific requirement: 2 CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (UG) requires compliance with the provisions of procurement standards. Condition: The Town?s procurement standards do not include the essential elements as outlined in 2 CFR sections 200.318 through 200.326. Questioned costs: None noted. Context: Although the Town did not have a policy in place in conformity with the federal uniform guidance criteria, the Town did follow Uniform Guidance and was in compliance with the major program. Cause: The policy has not been updated to be in compliance with uniform guidance requirements. Effect: With the absence of a compliant policy, the Town is at risk for noncompliance as it relates to federal procurement. Repeat Finding: N/A - First year audited as a major program. Recommendation: We recommend that the City review its formal procurement policies and make necessary changes to comply with the criteria as set out in 2 CFR sections 200.318 and 200.326. Views of responsible officials: Management agrees with this finding and is in process of developing a formal policy
2022-006 Federal Agency: Department of the Treasury and Federal Communications Commission Federal Program Name: American Rescue Plan Act and Emergency Connectivity Fund Program Assistance Listing Number: 21.027 and 32.009 Federal Award Identification Number and Year: 12060-OPM20600-29669 and ECF202108044 Pass-Through Agency: Office of Policy and Management Pass-Through Number(s): N/A Award Period: 7/1/2021 - 6/30/2022 Type of Finding: ? Significant Deficiency in Internal Control over Compliance ? Other Matters (Noncompliance) Criteria or specific requirement: 2 CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (UG) requires compliance with the provisions of suspension, and debarment. Condition: The Town must update their policies to indicate they will verify that an entity with which they plan to enter into a covered transaction is not debarred, suspended, or otherwise excluded. Questioned costs: None noted. Context: Although the Town did not have a policy in place in conformity with the federal uniform guidance criteria, the Town did follow Uniform Guidance and was in compliance with the major program. Cause: The policy has not been updated to be in compliance with uniform guidance requirements. Effect: With the absence of a compliant policy, the Town is at risk for noncompliance as it related to suspension & debarment. Repeat Finding: N/A - First year audited as a major program. Recommendation: We recommend that the City review its formal procurement policies and make necessary changes to comply with the criteria as set out in 2 CFR sections 200.318 and 200.326. Views of responsible officials: Management agrees with this finding and is in process of developing a formal policy.
2022-005 Federal Agency: Department of the Treasury and Federal Communications Commission Federal Program Name: American Rescue Plan Act and Emergency Connectivity Fund Program Assistance Listing Number: 21.027 and 32.009 Federal Award Identification Number and Year: 12060-OPM20600-29669 and ECF202108044 Pass-Through Agency: Office of Policy and Management Pass-Through Number(s): N/A Award Period: 7/1/2021 - 6/30/2022 Type of Finding: ? Significant Deficiency in Internal Control over Compliance ? Other Matters (Noncompliance) Criteria or specific requirement: 2 CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (UG) requires compliance with the provisions of procurement standards. Condition: The Town?s procurement standards do not include the essential elements as outlined in 2 CFR sections 200.318 through 200.326. Questioned costs: None noted. Context: Although the Town did not have a policy in place in conformity with the federal uniform guidance criteria, the Town did follow Uniform Guidance and was in compliance with the major program. Cause: The policy has not been updated to be in compliance with uniform guidance requirements. Effect: With the absence of a compliant policy, the Town is at risk for noncompliance as it relates to federal procurement. Repeat Finding: N/A - First year audited as a major program. Recommendation: We recommend that the City review its formal procurement policies and make necessary changes to comply with the criteria as set out in 2 CFR sections 200.318 and 200.326. Views of responsible officials: Management agrees with this finding and is in process of developing a formal policy
2022-006 Federal Agency: Department of the Treasury and Federal Communications Commission Federal Program Name: American Rescue Plan Act and Emergency Connectivity Fund Program Assistance Listing Number: 21.027 and 32.009 Federal Award Identification Number and Year: 12060-OPM20600-29669 and ECF202108044 Pass-Through Agency: Office of Policy and Management Pass-Through Number(s): N/A Award Period: 7/1/2021 - 6/30/2022 Type of Finding: ? Significant Deficiency in Internal Control over Compliance ? Other Matters (Noncompliance) Criteria or specific requirement: 2 CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (UG) requires compliance with the provisions of suspension, and debarment. Condition: The Town must update their policies to indicate they will verify that an entity with which they plan to enter into a covered transaction is not debarred, suspended, or otherwise excluded. Questioned costs: None noted. Context: Although the Town did not have a policy in place in conformity with the federal uniform guidance criteria, the Town did follow Uniform Guidance and was in compliance with the major program. Cause: The policy has not been updated to be in compliance with uniform guidance requirements. Effect: With the absence of a compliant policy, the Town is at risk for noncompliance as it related to suspension & debarment. Repeat Finding: N/A - First year audited as a major program. Recommendation: We recommend that the City review its formal procurement policies and make necessary changes to comply with the criteria as set out in 2 CFR sections 200.318 and 200.326. Views of responsible officials: Management agrees with this finding and is in process of developing a formal policy.
Finding No. 2022-002 Education Stabilization Fund: U.S. Department of Education: COVID-19 ? Higher Education Emergency Relief Fund ? Institutional Aid Portion, Assistance Listing 84.425F (award number P425F204328) Statistically valid sample: No and it was not intended to be. Repeat finding: Not a repeat finding. Compliance Requirement ? Procurement ? Significant Deficiency and Noncompliance 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. A non-federal entity must: ? For acquisitions exceeding the simplified acquisition threshold, the non-federal entity must use one of the following procurement methods: the sealed bid method if the acquisition meets the criteria in 2 CFR section 200.320(b); the competitive proposals method under the conditions specified in 2 CFR section 200.320((b) (2); or the noncompetitive proposals method (i.e., solicit a proposal from only one source) but only when one or more of four circumstances are met, in accordance with 2 CFR section 200.320(c)). For those procurements supported by HEERF grant funds, auditors should determine if institutions sufficiently documented rationales and determinations in making any sole source awards during the time of national emergency due to the coronavirus. Exceptions from the competitive procurement requirements of the Uniform Guidance may be accepted if institutions have documented that the public exigency or emergency would not permit a delay, in accordance with 2 CFR section 200.320(f)(2). A circumstance that may influence this determination is the length of time between the procurements and the emergency at issue. Specifically, exceptions are more likely to be acceptable the closer the procurement occurred to the March 13, 2020 declaration of the national emergency. Further, the non-Federal entity must establish and maintain an 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 terms and conditions of the Federal award (2 CFR 200.303). Condition and Context The University?s procurement policy for procurements over $10,000 is to either competitively bid it or document the sole source justification for why competitive bidding was not able to be completed. Based on our test work, for two of our seven selections, the University did not properly document its compliance with the procurement policy. For one selection, we noted that the University did not properly retain documentation for the competitive bidding, while for the other selection, the University did not properly document within the vendor?s procurement file that it was sole sourced due to the pandemic and needing the services in an expedited fashion as allowed per the HEERF requirements. Cause The documentation of procurement decisions was not properly retained to support the decisions made during the time period. Effect The University was not in compliance with their procurement policy. Questioned Costs There were no questioned costs identified as the University contracted with the respective parties in both cases and the costs were allowable under the HEERF requirements. Recommendation The University should strengthen its policies and practices to ensure that documentation is retained for all procurement decisions in order to support compliance with their procurement policy. Views of Responsible Official Management agrees with the recommendation. The University will ensure that all procurement decisions comply with the Stevens Procurement Policy and are properly documented, including the procurement method used (e.g., competitive bidding or sole source justification). The Director of Procurement will ensure that all Stevens employees responsible for making purchasing decisions at the University are familiar with the Procurement Policy and the need to ensure full compliance even when making purchasing decisions during emergency situations (e.g., COVID pandemic). The Director of Procurement will ensure compliance with the Stevens Procurement Policy.
2022 ? 006 Federal Agency: U.S. Department of Education Federal Program Name: Special Education Cluster (IDEA) Assistance Listing Number: 84.027/84.173 Federal Award Identification Number and Year: FY 2021 and FY 2022 Pass-Through Agency: Indiana Department of Education Pass-Through Numbers: H027A190084, H027X210084, H173A180104, H173A210104, H173X10104 Award Period: July 1, 2020 through June 30, 2022 Type of Finding: Material Weakness in Internal Control over Compliance, Material Noncompliance (Modified Opinion) Criteria or specific requirement: Non-federal entities other than 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 200.2 CFR 200.303 states in part: ?The Non-Federal entity must: (e) 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). . . ." Condition: During testing, it was noted that the School did not retain documentation to support compliance with federal procurement standards. Questioned costs: $146,707 Context: For 7 of 7 vendors tested, no documentation was maintained to support the method of procurement, selection of contract type, contractor selection or rejection, or the basis for the contract price. The sample was a statistically valid sample. Cause: Lack of formal procedures over federal purchase. Effect: The failure to establish an effective internal control system enabled material noncompliance to go undetected. Noncompliance with the grant agreement or the compliance requirement could have resulted in the loss of federal funds to the School Corporation Repeat Finding: The finding is a repeat of a finding in the immediately prior audit report. Prior audit finding number was 2020-005. Recommendation: We recommend that School management establish a system of internal controls to ensure compliance with the grant agreement and procurement requirements of the procurement process. Views of responsible officials: There is no disagreement with the audit finding.
2022 ? 006 Federal Agency: U.S. Department of Education Federal Program Name: Special Education Cluster (IDEA) Assistance Listing Number: 84.027/84.173 Federal Award Identification Number and Year: FY 2021 and FY 2022 Pass-Through Agency: Indiana Department of Education Pass-Through Numbers: H027A190084, H027X210084, H173A180104, H173A210104, H173X10104 Award Period: July 1, 2020 through June 30, 2022 Type of Finding: Material Weakness in Internal Control over Compliance, Material Noncompliance (Modified Opinion) Criteria or specific requirement: Non-federal entities other than 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 200.2 CFR 200.303 states in part: ?The Non-Federal entity must: (e) 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). . . ." Condition: During testing, it was noted that the School did not retain documentation to support compliance with federal procurement standards. Questioned costs: $146,707 Context: For 7 of 7 vendors tested, no documentation was maintained to support the method of procurement, selection of contract type, contractor selection or rejection, or the basis for the contract price. The sample was a statistically valid sample. Cause: Lack of formal procedures over federal purchase. Effect: The failure to establish an effective internal control system enabled material noncompliance to go undetected. Noncompliance with the grant agreement or the compliance requirement could have resulted in the loss of federal funds to the School Corporation Repeat Finding: The finding is a repeat of a finding in the immediately prior audit report. Prior audit finding number was 2020-005. Recommendation: We recommend that School management establish a system of internal controls to ensure compliance with the grant agreement and procurement requirements of the procurement process. Views of responsible officials: There is no disagreement with the audit finding.
2022 ? 006 Federal Agency: U.S. Department of Education Federal Program Name: Special Education Cluster (IDEA) Assistance Listing Number: 84.027/84.173 Federal Award Identification Number and Year: FY 2021 and FY 2022 Pass-Through Agency: Indiana Department of Education Pass-Through Numbers: H027A190084, H027X210084, H173A180104, H173A210104, H173X10104 Award Period: July 1, 2020 through June 30, 2022 Type of Finding: Material Weakness in Internal Control over Compliance, Material Noncompliance (Modified Opinion) Criteria or specific requirement: Non-federal entities other than 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 200.2 CFR 200.303 states in part: ?The Non-Federal entity must: (e) 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). . . ." Condition: During testing, it was noted that the School did not retain documentation to support compliance with federal procurement standards. Questioned costs: $146,707 Context: For 7 of 7 vendors tested, no documentation was maintained to support the method of procurement, selection of contract type, contractor selection or rejection, or the basis for the contract price. The sample was a statistically valid sample. Cause: Lack of formal procedures over federal purchase. Effect: The failure to establish an effective internal control system enabled material noncompliance to go undetected. Noncompliance with the grant agreement or the compliance requirement could have resulted in the loss of federal funds to the School Corporation Repeat Finding: The finding is a repeat of a finding in the immediately prior audit report. Prior audit finding number was 2020-005. Recommendation: We recommend that School management establish a system of internal controls to ensure compliance with the grant agreement and procurement requirements of the procurement process. Views of responsible officials: There is no disagreement with the audit finding.
2022 ? 006 Federal Agency: U.S. Department of Education Federal Program Name: Special Education Cluster (IDEA) Assistance Listing Number: 84.027/84.173 Federal Award Identification Number and Year: FY 2021 and FY 2022 Pass-Through Agency: Indiana Department of Education Pass-Through Numbers: H027A190084, H027X210084, H173A180104, H173A210104, H173X10104 Award Period: July 1, 2020 through June 30, 2022 Type of Finding: Material Weakness in Internal Control over Compliance, Material Noncompliance (Modified Opinion) Criteria or specific requirement: Non-federal entities other than 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 200.2 CFR 200.303 states in part: ?The Non-Federal entity must: (e) 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). . . ." Condition: During testing, it was noted that the School did not retain documentation to support compliance with federal procurement standards. Questioned costs: $146,707 Context: For 7 of 7 vendors tested, no documentation was maintained to support the method of procurement, selection of contract type, contractor selection or rejection, or the basis for the contract price. The sample was a statistically valid sample. Cause: Lack of formal procedures over federal purchase. Effect: The failure to establish an effective internal control system enabled material noncompliance to go undetected. Noncompliance with the grant agreement or the compliance requirement could have resulted in the loss of federal funds to the School Corporation Repeat Finding: The finding is a repeat of a finding in the immediately prior audit report. Prior audit finding number was 2020-005. Recommendation: We recommend that School management establish a system of internal controls to ensure compliance with the grant agreement and procurement requirements of the procurement process. Views of responsible officials: There is no disagreement with the audit finding.
2022 ? 006 Federal Agency: U.S. Department of Education Federal Program Name: Special Education Cluster (IDEA) Assistance Listing Number: 84.027/84.173 Federal Award Identification Number and Year: FY 2021 and FY 2022 Pass-Through Agency: Indiana Department of Education Pass-Through Numbers: H027A190084, H027X210084, H173A180104, H173A210104, H173X10104 Award Period: July 1, 2020 through June 30, 2022 Type of Finding: Material Weakness in Internal Control over Compliance, Material Noncompliance (Modified Opinion) Criteria or specific requirement: Non-federal entities other than 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 200.2 CFR 200.303 states in part: ?The Non-Federal entity must: (e) 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). . . ." Condition: During testing, it was noted that the School did not retain documentation to support compliance with federal procurement standards. Questioned costs: $146,707 Context: For 7 of 7 vendors tested, no documentation was maintained to support the method of procurement, selection of contract type, contractor selection or rejection, or the basis for the contract price. The sample was a statistically valid sample. Cause: Lack of formal procedures over federal purchase. Effect: The failure to establish an effective internal control system enabled material noncompliance to go undetected. Noncompliance with the grant agreement or the compliance requirement could have resulted in the loss of federal funds to the School Corporation Repeat Finding: The finding is a repeat of a finding in the immediately prior audit report. Prior audit finding number was 2020-005. Recommendation: We recommend that School management establish a system of internal controls to ensure compliance with the grant agreement and procurement requirements of the procurement process. Views of responsible officials: There is no disagreement with the audit finding.
2022 ? 006 Federal Agency: U.S. Department of Education Federal Program Name: Special Education Cluster (IDEA) Assistance Listing Number: 84.027/84.173 Federal Award Identification Number and Year: FY 2021 and FY 2022 Pass-Through Agency: Indiana Department of Education Pass-Through Numbers: H027A190084, H027X210084, H173A180104, H173A210104, H173X10104 Award Period: July 1, 2020 through June 30, 2022 Type of Finding: Material Weakness in Internal Control over Compliance, Material Noncompliance (Modified Opinion) Criteria or specific requirement: Non-federal entities other than 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 200.2 CFR 200.303 states in part: ?The Non-Federal entity must: (e) 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). . . ." Condition: During testing, it was noted that the School did not retain documentation to support compliance with federal procurement standards. Questioned costs: $146,707 Context: For 7 of 7 vendors tested, no documentation was maintained to support the method of procurement, selection of contract type, contractor selection or rejection, or the basis for the contract price. The sample was a statistically valid sample. Cause: Lack of formal procedures over federal purchase. Effect: The failure to establish an effective internal control system enabled material noncompliance to go undetected. Noncompliance with the grant agreement or the compliance requirement could have resulted in the loss of federal funds to the School Corporation Repeat Finding: The finding is a repeat of a finding in the immediately prior audit report. Prior audit finding number was 2020-005. Recommendation: We recommend that School management establish a system of internal controls to ensure compliance with the grant agreement and procurement requirements of the procurement process. Views of responsible officials: There is no disagreement with the audit finding.
2022 ? 006 Federal Agency: U.S. Department of Education Federal Program Name: Special Education Cluster (IDEA) Assistance Listing Number: 84.027/84.173 Federal Award Identification Number and Year: FY 2021 and FY 2022 Pass-Through Agency: Indiana Department of Education Pass-Through Numbers: H027A190084, H027X210084, H173A180104, H173A210104, H173X10104 Award Period: July 1, 2020 through June 30, 2022 Type of Finding: Material Weakness in Internal Control over Compliance, Material Noncompliance (Modified Opinion) Criteria or specific requirement: Non-federal entities other than 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 200.2 CFR 200.303 states in part: ?The Non-Federal entity must: (e) 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). . . ." Condition: During testing, it was noted that the School did not retain documentation to support compliance with federal procurement standards. Questioned costs: $146,707 Context: For 7 of 7 vendors tested, no documentation was maintained to support the method of procurement, selection of contract type, contractor selection or rejection, or the basis for the contract price. The sample was a statistically valid sample. Cause: Lack of formal procedures over federal purchase. Effect: The failure to establish an effective internal control system enabled material noncompliance to go undetected. Noncompliance with the grant agreement or the compliance requirement could have resulted in the loss of federal funds to the School Corporation Repeat Finding: The finding is a repeat of a finding in the immediately prior audit report. Prior audit finding number was 2020-005. Recommendation: We recommend that School management establish a system of internal controls to ensure compliance with the grant agreement and procurement requirements of the procurement process. Views of responsible officials: There is no disagreement with the audit finding.
2022 ? 006 Federal Agency: U.S. Department of Education Federal Program Name: Special Education Cluster (IDEA) Assistance Listing Number: 84.027/84.173 Federal Award Identification Number and Year: FY 2021 and FY 2022 Pass-Through Agency: Indiana Department of Education Pass-Through Numbers: H027A190084, H027X210084, H173A180104, H173A210104, H173X10104 Award Period: July 1, 2020 through June 30, 2022 Type of Finding: Material Weakness in Internal Control over Compliance, Material Noncompliance (Modified Opinion) Criteria or specific requirement: Non-federal entities other than 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 200.2 CFR 200.303 states in part: ?The Non-Federal entity must: (e) 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). . . ." Condition: During testing, it was noted that the School did not retain documentation to support compliance with federal procurement standards. Questioned costs: $146,707 Context: For 7 of 7 vendors tested, no documentation was maintained to support the method of procurement, selection of contract type, contractor selection or rejection, or the basis for the contract price. The sample was a statistically valid sample. Cause: Lack of formal procedures over federal purchase. Effect: The failure to establish an effective internal control system enabled material noncompliance to go undetected. Noncompliance with the grant agreement or the compliance requirement could have resulted in the loss of federal funds to the School Corporation Repeat Finding: The finding is a repeat of a finding in the immediately prior audit report. Prior audit finding number was 2020-005. Recommendation: We recommend that School management establish a system of internal controls to ensure compliance with the grant agreement and procurement requirements of the procurement process. Views of responsible officials: There is no disagreement with the audit finding.
Federal Agency: U.S. Department of the Treasury Federal Financial Assistance Listing: 21.027 Program Name: COVID-19 Coronavirus State and Local Fiscal Recovery Funds Compliance Requirement: Procurement, Suspension and Debarment Type of Finding: Significant Deficiency in Internal Control over Compliance, Instance of Non-compliance Criteria: General procurement standards 2 CFR 200.318 require the non-Federal entity to use its own documented procurement procedures which reflect applicable State, local, and tribal laws and regulations, provided that the procurements conform to applicable Federal law and standards identified in this part. The non-Federal entity's documented procurement procedures must conform to the procurement standards identified in 2 CFR sections 200.317 through 200.326. Prior to entering into subawards and contracts with award funds, recipients must verify that such contractors and subrecipients are not suspended, debarred, or otherwise excluded pursuant to 2 CFR section 200.214. Condition: The following required procurement standards were not addressed in the City's policy: ? Conflict of interest, including disciplinary actions for failure to adhere (2 CFR 200.318) ? Avoid acquisition of duplicative items (2 CFR 200.318) ? Cost effective purchasing (2 CFR 200.318) ? Document retention (2 CFR 200.318) ? Provisions to ensure all solicitations (2 CFR 200.319): Incorporate clear and accurate descriptions of technical requirements, do not restrict competition, and identify all requirements which the offerors must fulfill and factors used in evaluation ? Disadvantaged Business Enterprise program (2 CFR 200.321) ? Recovered materials, if subject to EPA requirements (2 CFR 200.322) ? Contract price/types (2 CFR 200.323) ? Bonding requirements (2 CFR 200.325) ? Contract provisions (2 CFR 200.326) Additionally, we identified 3 instances in which the City did not verify the vendor was not suspended, debarred, or otherwise excluded before entering into a covered transaction rather, verification was performed after entering into the transaction. The City asserted that they verified the vendors were not suspended or debarred; however, no documentation of the procedure being performed prior to entering into the transaction was presented. Cause: The City?s did not ensure it?s written procedures identified all of the required federal procurement standards. Additionally, the City?s controls did not ensure the check for suspension and debarment was performed and documented prior to entering into covered transactions. Effect: The City?s documented procurement procedures do not conform to the procurement standards identified in 2 CFR sections 200. 318, 200.319, and 200.321 through 200.326. Additionally, the City did not comply with the requirements of 2 CFR 200.214. Questioned Costs: None reported. Context/Sampling: The condition noted above was identified during our procedures related to procurement, suspension, and debarment. A non-statistical sample of 4 expenditures out of a population of 12 vendors were selected for testing as a whole. Repeat Finding from Prior Year: No. Recommendation: We recommend the City modify and strengthen its policies and procedures to ensure that the required Uniform Guidance standards are addressed. Views of Responsible Officials: Management agrees. See separately issued Corrective Action Plan.
2022-001 Uniform Guidance Written Policies and Procedures ? Significant Deficiency Criteria: Uniform Guidance policies requires 2 CFR Part 180, which states written policies and procedures related to internal controls be written regarding SAMS.gov contractor verification of debarment and suspension. In addition, 200.326 Contract Provisions that pay over $2,000 in labor wages require to be in compliant with Davis Bacon Labor Laws. This requirement contains written acknowledge of certified wage rate payrolls weekly and contractual language of the wage rate certification of payroll in the contract between the contractor and the District. Condition: We found that Powder River Conservation District does not have written updated policies implementing Uniform Guidance contractual and internal control procedures. Cause & Effect: The cause appears to be the result of a lack of experience, and the effect is non-compliance and the possibility of entering into transactions with debarred or suspended vendors, and not paying adequate Federal wages to labors. Questioned Costs: -0- Recommendation: We recommend that the District update and implement written internal control policies that coincide with Federal grant requirements and contain all Uniform Guidance regulations, relating to Sams.gov debarment and suspension, Davis-Bacon Wage Requirements and internal controls. Management Response: See the last page of this report for Management?s response as found on the District?s letterhead.
Material Weakness in Internal Control Over Compliance and Compliance Finding 2022-002: Special Test ? Wage Rate Requirement Department of Education Passed through the Virginia Department of Education Pass-through Entity Identifying Numbers: 601770, 501950, 501930, 501750 Program Name: COVID-19: Elementary and Secondary School Emergency Relief (ESSER) Fund Assistance Listing Number: 84.425D Criteria: Nonfederal entities shall include in their construction contracts subject to the Wage Rate Requirements (which still may be referenced as the Davis-Bacon Act) a provision that the contractor or subcontract comply with those requirements and the DOL regulations (29 CFR Part 5, Labor Standards Provisions Applicable to Contacts Governing Federally Financed and Assisted Construction). This includes a requirement for the contractor or subcontractor to submit to the nonfederal entity weekly, for each week in which any contract work is performed, a copy of the payroll and a statement of compliance (certified payrolls) (29 CFR sections 5.5 and 5.6; the A-102 Common Rule (section 36(i)(5)); OMB Circular A-110 (2 CFR Part 215, Appendix A, Contract Provisions); 2 CFR Part 176, Subpart C; and 2 CFR section 200.326). Condition: The School Board did not have adequate internal controls in place to verify this compliance requirement for this particular award prior to funds being spent. Cause: School Board employees were unaware the Wage Rate Requirement was applicable for this program due to confusion on some ESSER funds being exempt from this requirement. Effect: The School Board could have contracted with a vendor that did not meet the wage rate requirement. Questioned Costs: Unknown Context: Of the total expenditures for this program $604,730, or 6.43%, was spent to a vendor for various construction related projects in which the wage rate requirement was not verified with the contractor. Recommendation: We recommend the School Board implement new procedures to ensure all compliance requirements are being followed related to their federal awards. Views of Responsible Officials: The School Board agrees with this finding.
Finding 2022-01 ? Procurement, Suspension and Debarment Policy U.S. Department of Education Program (ED) Federal Program ? Hispanic-Serving Institutions - Science, Technology, Engineering, or Mathematics (HSI-STEM) and Articulation Programs (84.031C) Finding: The College does not have a formal written procurement, suspension and debarment policy that encompasses all required procurement standards set out in 2 CFR Sections 200.318 through 200.326. The policy is required under Uniform Guidance for direct purchases under the federal program. Criteria: Per 2 CFR 200.303, the College must establish and maintain effective internal controls over federal awards that provide reasonable assurance that it is managing federal awards in compliance with federal statutes, regulations and provisions of contracts or grant agreements that could have a material effect on each of its federal programs. Non-federal entities other than states, must follow procurement standards set out in 2 CFR Sections 200.318 through 200.326. Entities must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR part 200. Condition: The College did not have a procurement, suspension and debarment policy that complied with federal requirements in place at the time they expended funds under the HSI-STEM program. Cause: The federal funds received and expended during the year were new to the College during the 2021-2022 award year. In recent years, the other programs the College has participated in did not allow for direct purchases or include procurement as a material compliance requirement. Although the College did not have a written procurement, suspension and debarment policy in place, it did have documented approval limits for expenses made over certain dollar amounts to ensure purchases are made within authority limits and followed its established procurement procedures. Effect: The College did not comply with certain applicable federal regulations that could result in the loss of future federal funding. Questioned Costs: There were no questioned costs identified. Repeat Finding: This is not a repeat finding. Recommendation: The College should create a written procurement, suspension and debarment policy to ensure expenditures made with federal funds conform to applicable federal regulations. Views of responsible officials: Management agrees with this finding and will implement the recommendation. See Corrective Action Plan.
Finding 2022-01 ? Procurement, Suspension and Debarment Policy U.S. Department of Education Program (ED) Federal Program ? Hispanic-Serving Institutions - Science, Technology, Engineering, or Mathematics (HSI-STEM) and Articulation Programs (84.031C) Finding: The College does not have a formal written procurement, suspension and debarment policy that encompasses all required procurement standards set out in 2 CFR Sections 200.318 through 200.326. The policy is required under Uniform Guidance for direct purchases under the federal program. Criteria: Per 2 CFR 200.303, the College must establish and maintain effective internal controls over federal awards that provide reasonable assurance that it is managing federal awards in compliance with federal statutes, regulations and provisions of contracts or grant agreements that could have a material effect on each of its federal programs. Non-federal entities other than states, must follow procurement standards set out in 2 CFR Sections 200.318 through 200.326. Entities must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR part 200. Condition: The College did not have a procurement, suspension and debarment policy that complied with federal requirements in place at the time they expended funds under the HSI-STEM program. Cause: The federal funds received and expended during the year were new to the College during the 2021-2022 award year. In recent years, the other programs the College has participated in did not allow for direct purchases or include procurement as a material compliance requirement. Although the College did not have a written procurement, suspension and debarment policy in place, it did have documented approval limits for expenses made over certain dollar amounts to ensure purchases are made within authority limits and followed its established procurement procedures. Effect: The College did not comply with certain applicable federal regulations that could result in the loss of future federal funding. Questioned Costs: There were no questioned costs identified. Repeat Finding: This is not a repeat finding. Recommendation: The College should create a written procurement, suspension and debarment policy to ensure expenditures made with federal funds conform to applicable federal regulations. Views of responsible officials: Management agrees with this finding and will implement the recommendation. See Corrective Action Plan.
Finding 2022-003: Material Weakness ? Controls and Compliance over Special Tests and Provisions Program: COVID-19 Education Stabilization Fund Assistance Listing Number: 84.425D/84.425U Pass-Through Agency: Wisconsin Department of Public Instruction Criteria: All laborers and mechanics employed by contractors or subcontractors to work on construction contracts in excess of $2,000 financed by federal assistance funds must be paid wages not less than those established for the locality of the project (prevailing wage rates) by the Department of Labor (DOL) (40 USC 3141?3144, 3146, and 3147). This includes a requirement for the contractor or subcontractor to submit to the nonfederal entity weekly, for each week in which any contract work is performed, a copy of the payroll and a statement of compliance (certified payrolls) (29 CFR sections 5.5 and 5.6; the A-102 Common Rule (section 36(i)(5)); OMB Circular A-110 (2 CFR Part 215, Appendix A, Contract Provisions); 2 CFR Part 176, Subpart C; and 2 CFR section 200.326). Condition: Certified payrolls were not obtained or reviewed by the District. Cause: The District was not aware of this specific requirement. Effect: Federal funds may be paid to a contractor or subcontractor that pays wages less than the prevailing wage rates. Questioned Costs: None noted. Context: Program expenditures for fiscal 2022 included one construction contract. Recommendation: We recommend that the District implement a process to obtain certified payrolls when using federal funds on construction contracts. Once the certified payrolls are obtained, the District should review them as outlined by the applicable federal regulations and retain documentation of their conclusion. Views of responsible officials: The District will implement a process to obtain, review and retain certified payrolls if ever using federal funds on future construction contracts in excess of $2,000. The District has since received and reviewed the certified payrolls and determined the contractor is in compliance.
Finding 2022-003: Material Weakness ? Controls and Compliance over Special Tests and Provisions Program: COVID-19 Education Stabilization Fund Assistance Listing Number: 84.425D/84.425U Pass-Through Agency: Wisconsin Department of Public Instruction Criteria: All laborers and mechanics employed by contractors or subcontractors to work on construction contracts in excess of $2,000 financed by federal assistance funds must be paid wages not less than those established for the locality of the project (prevailing wage rates) by the Department of Labor (DOL) (40 USC 3141?3144, 3146, and 3147). This includes a requirement for the contractor or subcontractor to submit to the nonfederal entity weekly, for each week in which any contract work is performed, a copy of the payroll and a statement of compliance (certified payrolls) (29 CFR sections 5.5 and 5.6; the A-102 Common Rule (section 36(i)(5)); OMB Circular A-110 (2 CFR Part 215, Appendix A, Contract Provisions); 2 CFR Part 176, Subpart C; and 2 CFR section 200.326). Condition: Certified payrolls were not obtained or reviewed by the District. Cause: The District was not aware of this specific requirement. Effect: Federal funds may be paid to a contractor or subcontractor that pays wages less than the prevailing wage rates. Questioned Costs: None noted. Context: Program expenditures for fiscal 2022 included one construction contract. Recommendation: We recommend that the District implement a process to obtain certified payrolls when using federal funds on construction contracts. Once the certified payrolls are obtained, the District should review them as outlined by the applicable federal regulations and retain documentation of their conclusion. Views of responsible officials: The District will implement a process to obtain, review and retain certified payrolls if ever using federal funds on future construction contracts in excess of $2,000. The District has since received and reviewed the certified payrolls and determined the contractor is in compliance.
Finding 2022-002: COVID-19 Education Stabilization Fund, Higher Education Emergency Relief Funds, Procurement, Suspension and Disbarment Federal Program - COVID-19 Education Stabilization Fund (ESF) - Institutional Portion Federal Agency - U.S. Department of Education Pass-Through Entity - Not Applicable AL Number - 84.425F, 84.425N Federal Award Identification Numbers - P425F205088 Federal Award Year - June 30, 2022 Criteria: General procurement standards outlined in 2 CFR 200.318(a) state that a non-Federal entity. Must use its own documented procurement procedures which reflect applicable State, local, and tribal laws and regulations, provided that the procurements conform to the applicable Federal law and the standards identified by the Uniform Guidance (sections 200.318 ? 200.326). The Uniform Guidance outlines requirements over the proper oversight of contractors, having written standards of conduct for employees involved in contracting, awarding contracts to responsible contractors, maintaining records documenting the history of procurements including cost price analysis, conducting all transactions in a manner which provides full and open competition, having procedures for verifying that an entity with which it plans to enter into a covered transaction is not debarred, suspended, or otherwise excluded, utilizing the methods of procurement outlined in the Uniform Guidance, and ensuring every purchase order or contract includes the applicable provisions in Appendix II. Condition: The School?s policies and procedures over procurement generally comply with the requirements outlined by the Uniform Guidance, which establishes methods of procurement to be utilized related to the acquisition of both goods and services. However, the School?s policies do not fully adhere to the requirements, as there is no policy or procedure in place related to the verification of vendor suspension or debarment prior to contracting with the vendor. Additionally, the auditors reviewed one procurement transaction over the micro-purchase threshold and noted that the School?s policies were not followed with regard to ensuring full and open competition by obtaining bids or quotes. The School did check for suspension/disbarment following our identification of the finding, and there were no issues. Questioned Costs: Not applicable. Context: Not applicable. Cause: The School's policies were not compared to Uniform Guidance to ensure all elements were incorporated prior to entering into a contract with a vendor for which federal funds were the source of the expenditure. Additionally, the School?s procedures were not followed appropriately with regard to vendor bids/selection. Effect: The School is at risk of procuring goods and services that are not in compliance with the requirements of the Uniform Guidance, which increases the risk of federal funds being used improperly or the School entering into a covered transaction with a vendor that is suspended or debarred. Recommendation: The School should revise its policies and procedures to comply with the requirements of the Uniform Guidance and ensure that they are followed to verify that a vendor with which it plans to enter into a covered transaction is not debarred, suspended, or otherwise excluded. Additionally, all employees involved in procurement should be trained on the School?s procurement policies and procedures to avoid a break down of internal controls designed to reduce the risk of improper expenditures. Management's Response: Management did review all HEERF-related contracts and expenditures for reasonableness to ensure that the school was being prudent with its financial resources. Management agrees with the finding and will draft a ?Federal Grants Management Policy Manual? and implement related procedures which will be in compliance with 2 CFR 200.318(a). Policy and procedures will address all applicable compliance requirements.
Finding 2022-002: COVID-19 Education Stabilization Fund, Higher Education Emergency Relief Funds, Procurement, Suspension and Disbarment Federal Program - COVID-19 Education Stabilization Fund (ESF) - Institutional Portion Federal Agency - U.S. Department of Education Pass-Through Entity - Not Applicable AL Number - 84.425F, 84.425N Federal Award Identification Numbers - P425F205088 Federal Award Year - June 30, 2022 Criteria: General procurement standards outlined in 2 CFR 200.318(a) state that a non-Federal entity. Must use its own documented procurement procedures which reflect applicable State, local, and tribal laws and regulations, provided that the procurements conform to the applicable Federal law and the standards identified by the Uniform Guidance (sections 200.318 ? 200.326). The Uniform Guidance outlines requirements over the proper oversight of contractors, having written standards of conduct for employees involved in contracting, awarding contracts to responsible contractors, maintaining records documenting the history of procurements including cost price analysis, conducting all transactions in a manner which provides full and open competition, having procedures for verifying that an entity with which it plans to enter into a covered transaction is not debarred, suspended, or otherwise excluded, utilizing the methods of procurement outlined in the Uniform Guidance, and ensuring every purchase order or contract includes the applicable provisions in Appendix II. Condition: The School?s policies and procedures over procurement generally comply with the requirements outlined by the Uniform Guidance, which establishes methods of procurement to be utilized related to the acquisition of both goods and services. However, the School?s policies do not fully adhere to the requirements, as there is no policy or procedure in place related to the verification of vendor suspension or debarment prior to contracting with the vendor. Additionally, the auditors reviewed one procurement transaction over the micro-purchase threshold and noted that the School?s policies were not followed with regard to ensuring full and open competition by obtaining bids or quotes. The School did check for suspension/disbarment following our identification of the finding, and there were no issues. Questioned Costs: Not applicable. Context: Not applicable. Cause: The School's policies were not compared to Uniform Guidance to ensure all elements were incorporated prior to entering into a contract with a vendor for which federal funds were the source of the expenditure. Additionally, the School?s procedures were not followed appropriately with regard to vendor bids/selection. Effect: The School is at risk of procuring goods and services that are not in compliance with the requirements of the Uniform Guidance, which increases the risk of federal funds being used improperly or the School entering into a covered transaction with a vendor that is suspended or debarred. Recommendation: The School should revise its policies and procedures to comply with the requirements of the Uniform Guidance and ensure that they are followed to verify that a vendor with which it plans to enter into a covered transaction is not debarred, suspended, or otherwise excluded. Additionally, all employees involved in procurement should be trained on the School?s procurement policies and procedures to avoid a break down of internal controls designed to reduce the risk of improper expenditures. Management's Response: Management did review all HEERF-related contracts and expenditures for reasonableness to ensure that the school was being prudent with its financial resources. Management agrees with the finding and will draft a ?Federal Grants Management Policy Manual? and implement related procedures which will be in compliance with 2 CFR 200.318(a). Policy and procedures will address all applicable compliance requirements.
Finding 2022-002: COVID-19 Education Stabilization Fund, Higher Education Emergency Relief Funds, Procurement, Suspension and Disbarment Federal Program - COVID-19 Education Stabilization Fund (ESF) - Institutional Portion Federal Agency - U.S. Department of Education Pass-Through Entity - Not Applicable AL Number - 84.425F, 84.425N Federal Award Identification Numbers - P425F205088 Federal Award Year - June 30, 2022 Criteria: General procurement standards outlined in 2 CFR 200.318(a) state that a non-Federal entity. Must use its own documented procurement procedures which reflect applicable State, local, and tribal laws and regulations, provided that the procurements conform to the applicable Federal law and the standards identified by the Uniform Guidance (sections 200.318 ? 200.326). The Uniform Guidance outlines requirements over the proper oversight of contractors, having written standards of conduct for employees involved in contracting, awarding contracts to responsible contractors, maintaining records documenting the history of procurements including cost price analysis, conducting all transactions in a manner which provides full and open competition, having procedures for verifying that an entity with which it plans to enter into a covered transaction is not debarred, suspended, or otherwise excluded, utilizing the methods of procurement outlined in the Uniform Guidance, and ensuring every purchase order or contract includes the applicable provisions in Appendix II. Condition: The School?s policies and procedures over procurement generally comply with the requirements outlined by the Uniform Guidance, which establishes methods of procurement to be utilized related to the acquisition of both goods and services. However, the School?s policies do not fully adhere to the requirements, as there is no policy or procedure in place related to the verification of vendor suspension or debarment prior to contracting with the vendor. Additionally, the auditors reviewed one procurement transaction over the micro-purchase threshold and noted that the School?s policies were not followed with regard to ensuring full and open competition by obtaining bids or quotes. The School did check for suspension/disbarment following our identification of the finding, and there were no issues. Questioned Costs: Not applicable. Context: Not applicable. Cause: The School's policies were not compared to Uniform Guidance to ensure all elements were incorporated prior to entering into a contract with a vendor for which federal funds were the source of the expenditure. Additionally, the School?s procedures were not followed appropriately with regard to vendor bids/selection. Effect: The School is at risk of procuring goods and services that are not in compliance with the requirements of the Uniform Guidance, which increases the risk of federal funds being used improperly or the School entering into a covered transaction with a vendor that is suspended or debarred. Recommendation: The School should revise its policies and procedures to comply with the requirements of the Uniform Guidance and ensure that they are followed to verify that a vendor with which it plans to enter into a covered transaction is not debarred, suspended, or otherwise excluded. Additionally, all employees involved in procurement should be trained on the School?s procurement policies and procedures to avoid a break down of internal controls designed to reduce the risk of improper expenditures. Management's Response: Management did review all HEERF-related contracts and expenditures for reasonableness to ensure that the school was being prudent with its financial resources. Management agrees with the finding and will draft a ?Federal Grants Management Policy Manual? and implement related procedures which will be in compliance with 2 CFR 200.318(a). Policy and procedures will address all applicable compliance requirements.
U.S. Department of Education Program Name: Education Stabilization Fund AL No. 84.425 MATERIAL WEAKNESS 2022-002 SPECIAL TESTS AND PROVISIONS Criteria: Per the 2022 OMB Compliance Supplement, ?All laborers and mechanics employed by contractors or subcontractors to work on construction contracts in excess of $2,000 financed by federal assistance funds must be paid wages not less than those established for the locality of the project (prevailing wage rates) by the Department of Labor (DOL) (40 USC 3141?3144, 3146, and 3147). Nonfederal entities shall include in their construction contracts subject to the Wage Rate Requirements (which still may be referenced as the Davis-Bacon Act) a provision that the contractor or subcontractor comply with those requirements and the DOL regulations (29 CFR Part 5, Labor Standards Provisions Applicable to Contacts Governing Federally Financed and Assisted Construction). This includes a requirement for the contractor or subcontractor to submit to the nonfederal entity weekly, for each week in which any contract work is performed, a copy of the payroll and a statement of compliance (certified payrolls) (29 CFR sections 5.5 and 5.6; the A-102 Common Rule (section 36(i)(5)); OMB Circular A-110 (2 CFR Part 215, Appendix A, Contract Provisions); 2 CFR Part 176, Subpart C; and 2 CFR section 200.326).? Condition: During our testing of the District?s Education Stabilization Fund, we noted the District had a contract for flooring installation that was subject to the prevailing wage rate requirements under 20 USC 1232b; however, the contractor did not pay prevailing wages for the work performed. Questioned Costs: None Context: We noted that the District?s flooring contractor did not pay prevailing wages as required by the Department of Labor for federally-financed contracts. Cause: The District understood the threshold for compliance with the prevailing wage requirements to be more a federally-financed contract exceeding $75,000 rather than federally-financed contracts exceeding $2,000. Effect: The District did not comply with the prevailing wage requirements for the Education Stabilization Fund. Recommendation: We recommend that the District acquire understanding of requirements related to expenditure of federal funds on construction and remodeling projects. Response: The District was unaware of the prevailing wage requirements for federally financed contracts in excess of $2,000. The District was under the impression that the prevailing wage requirements only applied to federally financed contracts exceeding $75,000. The District has pursued education on the federal requirements regarding prevailing wage, and will make steps moving forward to ensure compliance with the federal standards relating to prevailing wage of federally financed contracts.
2022-002 Federal Agency: United States Department of Treasury Federal Program Name: COVID-19 ARPA Local Fiscal Recovery Assistance Listing Number: 21.027 Federal Award Identification Number and Year: N/A Pass-Through Agency: State of Connecticut Office of Policy and Management Pass-Through Number(s): 12060-OPM20600-29669 Award Period: March 3, 2021, through December 31, 2024 Type of Finding: ? Significant Deficiency in Internal Control over Compliance ? Other Matters (Noncompliance) Criteria or specific requirement: 2 CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (UG) requires compliance with the provisions of procurement, suspension, and debarment. Condition: The Town?s procurement standards included an incorrect threshold for small purchases as outlined in 2 CFR sections 200.318 through 200.326 ($25,000 versus $10,000). Questioned costs: None noted. Context: Although the Town did not have the correct threshold in place for small purchases in conformity with the federal uniform guidance criteria, the Town?s expenditures for ARPA were over the competitive bid threshold. Expenditures within the fiscal year were properly procured with competitive bids. Cause: The Town was unaware of the UG threshold requirements for small purchases. Effect: With the absence of a compliant policy, the Town is at risk for noncompliance as it relates to federal procurement. Repeat Finding: No. Recommendation: We recommend that the Town review its formal procurement policies and make necessary changes to comply with the criteria as set out in 2 CFR sections 200.318 and 200.326. Views of responsible officials: There is no disagreement with the audit finding.
Federal program: 84.425 Education Stabilization Fund (ESF) Criteria: Construction contracts in excess of $2,000 financed by federal assistance funds are required to include: a provision that the contractor or subcontractor comply with the wage rate requirements of the Davis-Bacon Act and the U.S. Department of Labor regulations (29 CFR Part 5, Labor Standards Provisions Applicable to Contacts Governing Federally Financed and Assisted Construction); and a requirement for the contractor or subcontractor to submit to the nonfederal entity weekly, for each week in which any contract work is performed, a copy of the payroll and a statement of compliance (certified payrolls) (29 CFR sections 5.5 and 5.6; the A-102 Common Rule (section 36(i)(5)); OMB Circular A-110 (2 CFR Part 215, Appendix A, Contract Provisions); 2 CFR Part 176, Subpart C; and 2 CFR section 200.326). Condition: The provisions for the prevailing wage rates requirements were not included in the construction contracts in excess of $2,000 financed by ESF funds and that the required certified payrolls were not obtained. The related deficiency in internal controls over compliance is considered to be a significant deficiency. Cause: As the District does not typically fund construction projects with federal funds, the District?s staff were unaware of the $2,000 threshold for construction contacts financed by ESF funds to include prevailing wage rates requirements and used a threshold of $50,000, the Oregon Bureau of Labor & Industries? threshold for prevailing wage rate requirements for public works projects in Oregon. Effect or potential effect: Without adequate internal controls over wage rate requirements and including the required provisions in construction contracts in excess of $2,000 financed by ESF funds, the District cannot demonstrate compliance with the wage rate requirements of the Davis-Bacon Act requirements. Questioned Costs: Questioned costs, if any, are indeterminable. Context: Out of nine capital projects totaling $123,558, a sample of three capital projects was haphazardly selected. The capital projects were between $9,405 and $14,360 and totaled $26,024. Recommendation: The District should obtain an understanding of all compliance requirements and implement controls to ensure compliance with federal wage rate requirements. Views of responsible officials: The District understands and concurs with this finding.
Federal program: 84.425 Education Stabilization Fund (ESF) Criteria: Construction contracts in excess of $2,000 financed by federal assistance funds are required to include: a provision that the contractor or subcontractor comply with the wage rate requirements of the Davis-Bacon Act and the U.S. Department of Labor regulations (29 CFR Part 5, Labor Standards Provisions Applicable to Contacts Governing Federally Financed and Assisted Construction); and a requirement for the contractor or subcontractor to submit to the nonfederal entity weekly, for each week in which any contract work is performed, a copy of the payroll and a statement of compliance (certified payrolls) (29 CFR sections 5.5 and 5.6; the A-102 Common Rule (section 36(i)(5)); OMB Circular A-110 (2 CFR Part 215, Appendix A, Contract Provisions); 2 CFR Part 176, Subpart C; and 2 CFR section 200.326). Condition: The provisions for the prevailing wage rates requirements were not included in the construction contracts in excess of $2,000 financed by ESF funds and that the required certified payrolls were not obtained. The related deficiency in internal controls over compliance is considered to be a significant deficiency. Cause: As the District does not typically fund construction projects with federal funds, the District?s staff were unaware of the $2,000 threshold for construction contacts financed by ESF funds to include prevailing wage rates requirements and used a threshold of $50,000, the Oregon Bureau of Labor & Industries? threshold for prevailing wage rate requirements for public works projects in Oregon. Effect or potential effect: Without adequate internal controls over wage rate requirements and including the required provisions in construction contracts in excess of $2,000 financed by ESF funds, the District cannot demonstrate compliance with the wage rate requirements of the Davis-Bacon Act requirements. Questioned Costs: Questioned costs, if any, are indeterminable. Context: Out of nine capital projects totaling $123,558, a sample of three capital projects was haphazardly selected. The capital projects were between $9,405 and $14,360 and totaled $26,024. Recommendation: The District should obtain an understanding of all compliance requirements and implement controls to ensure compliance with federal wage rate requirements. Views of responsible officials: The District understands and concurs with this finding.
Finding Number: 2022-001 Repeat Finding: Yes, 2021-001 Program Name/Assistance Listing Title: Indian School Equalization Assistance Listing Number: 15.042 Federal Agency: U.S. Department of the Interior Federal Award Number: A19AV00937 Pass-Through Agency: Bureau of Indian Affairs Questioned Costs: N/A Type of Finding: Noncompliance, Material Weakness Compliance Requirement: Procurement, Suspension and Debarment 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 ??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. Additionally, non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. When a non-federal entity enters into a covered transaction with an entity at a lower tier, the non-federal entity must verify that the entity, as defined in 2 CFR ?180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. This verification may be accomplished by (1) checking the System of Award Management (SAM) maintained by the General Services Administration (GSA) or (2) collecting a certification from the entity, or adding a clause or condition to the covered transaction with that entity (2 CFR ?180.300). CONDITION Adequate internal controls over its procurement procedures to ensure compliance with federal regulations and guidelines and School policies were not in place. The School did not establish complete written procurement standards. In addition, the School did not initially meet the requirement to verify that covered transactions were only made to an entity that was not suspended or debarred or otherwise excluded. Lastly, the School did not follow federal guidelines for purchases exceeding the small purchases threshold. CAUSE The School?s internal controls over procurement of goods and services were not adequate. EFFECT The School was not in compliance with Federal regulations and guidelines related to suspension and debarment or procurement. CONTEXT The sample was not intended to be, and was not, a statistically valid sample. During our review of purchasing, we noted the following: - For six of seven procurements over $25,000 reviewed, documentation demonstrating a vendor check for suspension and debarment was not retained. - Sealed bids were not performed in accordance with School policies. However, these purchases did not rise above the Simplified Acquisition Threshold. - For eight of 10 vendors reviewed with total expenditures below the Simplified Acquisition threshold, no documentation of quotes was maintained. - The School's policy did not include any language regarding quotes and thresholds. RECOMMENDATION The School should develop and implement policies and procedures to ensure compliance with federal procurement requirements. VIEWS OF RESPONSIBLE OFFICIALS See Corrective Action Plan.
FINDING 22-2: PROCUREMENT POLICIES AND PROCEDURES Condition The Institution?s procurement policies and procedures did not include certain aspects of the applicable federal regulations and other procurement requirements specific to the HEERF program, including the various thresholds for vendor selection and purchases (micro - purchase, small purchase, sealed bid, and simplified acquisition methods) and conflict of interest policies related to procurement. Criteria Institutions must follow the procurement standards set out at 2 C.F.R. ?? 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 C.F.R. part 200. 2 C.F.R. ? 200.318 through 200.326 Cause The Institution used its current policy for procurement that required various levels of internal management approval for purchases and didn?t have specific policies under 2 CFR 200. The institution did not verify that vendors were not disbarred prior to purchasing or making drawdowns. Effect There were no questioned costs associated with this finding as the Institution?s purchases claimed using HEERF were for allowable costs. Over $280,000 of the expenditures claimed would have been applicable for the small purchase method while all other purchases would have been applicable for the micro-purchase method. In certain instances, the Institution received approval from ED approving expenditures to be claimed using HEERF. In some cases, the Institution did receive bids from multiple vendors and researched what vendors were able to supply their needs. The individual responsible for overseeing the purchases determined that the price was fair and reasonable. Recommendation The Institution should update its procurement policies and procedures to ensure that all applicable aspects of the federal guidelines are documented and in accordance with the federal regulations. Views of Responsible Officials The Institution has reviewed the finding and concurs with the recommendation. As outlined in the Corrective Action Plan, the Institution has procedures in place to ensure compliance with the requirements.
Finding No. 2022-002 Procurement Federal Agency: U.S. Department of the Treasury Federal Program Name: COVID-19 American Rescue Plan Act Local Fiscal Recovery Assistance Listing Number: 21.027 Pass-Through Agency: State of Connecticut Office of Policy and Management Pass-Through Number(s): 12060-OPM20600-29669 Award Period: June 7, 2021 through December 31, 2026 Type of Finding: ? Material Weakness in Internal Control over Compliance ? Material Noncompliance (Modified Opinion) Criteria The Town must comply with procurement standards set out at 2 CFR sections 200.318 through 200.326 within Uniform Guidance. Condition The Town?s procurement standards do not include the essential elements as outlined in 2 CFR sections 200.318 through 200.326 and purchases were made that did not follow these requirements. Questioned Costs None noted. Context The Town did not have a policy in place in conformity with the federal Uniform Guidance criteria and purchases were made that did not follow these requirements. Effect With the absence of a compliant policy, the Town made purchases that did not follow federal Uniform Guidance procurement standards. Cause The Town was not aware of the details surrounding the Uniform Guidance procurement standards and its policy was not updated. Recommendation We recommend that the Town review its formal procurement policies and make necessary changes to comply with the criteria as set out in 2 CFR sections 200.318 and 200.326. Views of Responsible Officials and Planned Corrective Actions Management agrees with the auditors? recommendations. Corrective action will be taken to ensure the policy is updated and the correct procurement procedures are followed.
2022-005 Failure to Comply with Procurement Policy Finding Type: Material Weakness in Internal Control over Major Programs CFDA#: 84.031B Title III Part B, Strengthening Historically Black Colleges and Universities Award Year: 2022 CFDA#: 84.425E/84.425F/84.425J CARES Act: Higher Education Emergency Relief Fund (HEERF) Award Year: 2022 Criteria: The terms of the programs and Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), requires the use of purchase requisitions for all non-exempt purchases. With certain exceptions for sole source and emergencies, the following must be attached to the purchase requisition: Under current procedures, competitive quotes must be obtained as a prerequisite for purchases over $500. The current policy also does not meet the minimum requirement for purchases exceeding the simplified acquisition threshold (greater than $250,000). Condition: The College did not follow its procurement policy for the year ended June 30, 2022. We found that disbursements over $500 did not have competitive quotes when required. Effect of Condition and Questioned Costs: The College has not complied with its procurement policy, and it is not known whether the College has paid a reasonable and competitive rate for the services provided on the various contracts. The dollar amount of the contracts totaled $821,643 for Title III and $74,455 for HEERF. Cause: There was a lack of appropriate internal control policies and procedures implemented at the College during the fiscal year to ensure procurement policies and procedures were performed before disbursement of funds occurred. There is also a lack of understanding of minimum requirements to ensure the College?s policy meets the standards as noted above. Recommendation: We recommended updating the procurement policy to align with the procurement standards set out at 2 CFR sections 200.318 through 200.326 and management be familiar with polices and ensure they are being adhered to. View of Responsible Officials and Planned Corrective Action: The College agrees with the finding and management will take necessary steps to adhere to and update the procurement policy.
2022-005 Failure to Comply with Procurement Policy Finding Type: Material Weakness in Internal Control over Major Programs CFDA#: 84.031B Title III Part B, Strengthening Historically Black Colleges and Universities Award Year: 2022 CFDA#: 84.425E/84.425F/84.425J CARES Act: Higher Education Emergency Relief Fund (HEERF) Award Year: 2022 Criteria: The terms of the programs and Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), requires the use of purchase requisitions for all non-exempt purchases. With certain exceptions for sole source and emergencies, the following must be attached to the purchase requisition: Under current procedures, competitive quotes must be obtained as a prerequisite for purchases over $500. The current policy also does not meet the minimum requirement for purchases exceeding the simplified acquisition threshold (greater than $250,000). Condition: The College did not follow its procurement policy for the year ended June 30, 2022. We found that disbursements over $500 did not have competitive quotes when required. Effect of Condition and Questioned Costs: The College has not complied with its procurement policy, and it is not known whether the College has paid a reasonable and competitive rate for the services provided on the various contracts. The dollar amount of the contracts totaled $821,643 for Title III and $74,455 for HEERF. Cause: There was a lack of appropriate internal control policies and procedures implemented at the College during the fiscal year to ensure procurement policies and procedures were performed before disbursement of funds occurred. There is also a lack of understanding of minimum requirements to ensure the College?s policy meets the standards as noted above. Recommendation: We recommended updating the procurement policy to align with the procurement standards set out at 2 CFR sections 200.318 through 200.326 and management be familiar with polices and ensure they are being adhered to. View of Responsible Officials and Planned Corrective Action: The College agrees with the finding and management will take necessary steps to adhere to and update the procurement policy.
2022-005 Failure to Comply with Procurement Policy Finding Type: Material Weakness in Internal Control over Major Programs CFDA#: 84.031B Title III Part B, Strengthening Historically Black Colleges and Universities Award Year: 2022 CFDA#: 84.425E/84.425F/84.425J CARES Act: Higher Education Emergency Relief Fund (HEERF) Award Year: 2022 Criteria: The terms of the programs and Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), requires the use of purchase requisitions for all non-exempt purchases. With certain exceptions for sole source and emergencies, the following must be attached to the purchase requisition: Under current procedures, competitive quotes must be obtained as a prerequisite for purchases over $500. The current policy also does not meet the minimum requirement for purchases exceeding the simplified acquisition threshold (greater than $250,000). Condition: The College did not follow its procurement policy for the year ended June 30, 2022. We found that disbursements over $500 did not have competitive quotes when required. Effect of Condition and Questioned Costs: The College has not complied with its procurement policy, and it is not known whether the College has paid a reasonable and competitive rate for the services provided on the various contracts. The dollar amount of the contracts totaled $821,643 for Title III and $74,455 for HEERF. Cause: There was a lack of appropriate internal control policies and procedures implemented at the College during the fiscal year to ensure procurement policies and procedures were performed before disbursement of funds occurred. There is also a lack of understanding of minimum requirements to ensure the College?s policy meets the standards as noted above. Recommendation: We recommended updating the procurement policy to align with the procurement standards set out at 2 CFR sections 200.318 through 200.326 and management be familiar with polices and ensure they are being adhered to. View of Responsible Officials and Planned Corrective Action: The College agrees with the finding and management will take necessary steps to adhere to and update the procurement policy.
2022-005 Failure to Comply with Procurement Policy Finding Type: Material Weakness in Internal Control over Major Programs CFDA#: 84.031B Title III Part B, Strengthening Historically Black Colleges and Universities Award Year: 2022 CFDA#: 84.425E/84.425F/84.425J CARES Act: Higher Education Emergency Relief Fund (HEERF) Award Year: 2022 Criteria: The terms of the programs and Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), requires the use of purchase requisitions for all non-exempt purchases. With certain exceptions for sole source and emergencies, the following must be attached to the purchase requisition: Under current procedures, competitive quotes must be obtained as a prerequisite for purchases over $500. The current policy also does not meet the minimum requirement for purchases exceeding the simplified acquisition threshold (greater than $250,000). Condition: The College did not follow its procurement policy for the year ended June 30, 2022. We found that disbursements over $500 did not have competitive quotes when required. Effect of Condition and Questioned Costs: The College has not complied with its procurement policy, and it is not known whether the College has paid a reasonable and competitive rate for the services provided on the various contracts. The dollar amount of the contracts totaled $821,643 for Title III and $74,455 for HEERF. Cause: There was a lack of appropriate internal control policies and procedures implemented at the College during the fiscal year to ensure procurement policies and procedures were performed before disbursement of funds occurred. There is also a lack of understanding of minimum requirements to ensure the College?s policy meets the standards as noted above. Recommendation: We recommended updating the procurement policy to align with the procurement standards set out at 2 CFR sections 200.318 through 200.326 and management be familiar with polices and ensure they are being adhered to. View of Responsible Officials and Planned Corrective Action: The College agrees with the finding and management will take necessary steps to adhere to and update the procurement policy.
2022-003 Procurement, Suspension and Debarment Federal Agency: United States Department of Agriculture Federal Program Name: Child Nutrition Cluster Assistance Listing Number: 10.553 / 10.555 Pass-Through Agency: State of Connecticut Department of Education Pass-Through Number(s): 12060-SDE64370-20560 / 12060-SDE64370-20508 Award Period: July 1, 2021 through June 30, 2022 Type of Finding: ? Significant Deficiency in Internal Control over Compliance ? Other Matters Criteria or Specific Requirement: 2 CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Award requires compliance with the provisions of procurement, suspension, and debarment. EASTCONN should have internal controls designed to ensure compliance with those provisions. Condition: EASTCONN?s procurement standards do not include the required elements as outlined in 2 CFR sections 200.318 through 200.326. Questioned Costs: None Context: Although EASTCONN did not have a policy in place in conformity with the Federal Uniform Guidance criteria, EASTCONN did follow its own procedures as it relates to the contracts under the procurements applicable to EASTCONN?s major programs. Cause: EASTCONN did not formally update their procurement policy as any federal grants they receive in which procurement is required, the appropriate language is included in the grant requirements and documents. Effect: The auditor noted no instances of noncompliance with the provisions of procurement, suspension, and debarment; however, the lack of internal controls over these compliance requirements provides an opportunity for noncompliance. Repeat Finding: No Recommendation: We recommend that EASTCON review its formal procurement policies and make necessary changes to comply with the criteria as set out in 2 CFR sections 200.318 and 200.326. Views of Responsible Officials: Management agrees with this finding.