Finding 1076555 (2023-002)

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. Condition: The Organization does not have a documented procurement policy that conforms to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. Context: During the year, the Organization entered into contracts for services that was greater than the Simple Acquisition Threshold of $250,000. As part of the audit procedures, we requested the Organization’s documented procurement policy. The Organization did not have a documented procurement policy. Prior to entering agreements to making purchases in excess of the simplified acquisition threshold, the Organization performed a price analysis in a manner consistent with 2 CFR Part 200. Cause: The Organization was not aware that a documented procurement policy was required. Effect: Without documented procurement policies, the Organization could procure assets in a manner that is not consistent with 2 CFR Part 200. Recommendation: We recommend that the Organization familiarize themselves with the requirements of 2 CFR sections 200.318 through 200.326 and develop a documented procurement policy that conforms to applicable federal statutes and procurement requirements. Management’s Response: Management agrees.