Finding Text
Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control
over the federal award that provides assurance that the entity is managing the federal award in compliance with
federal statutes, regulations, and conditions of the federal award. The non-Federal entity’s documented
procurement procedures must conform to the procurement standards identified in 2 CFR 200.318 through
200.317 which also requires documentation to be retained to detail the history of procurements.
Condition: The organization has not adopted a procurement policy containing required provisions in accordance
with 2 CFR 200.318. For each of the 5 vendors selected for testing there was no documentation retained to
support the rationale for the method of procurement. Additionally, the Organization did not consider whether
the vendor was suspended or debarred from doing business with the federal government prior to entering the
covered transaction for each of the 5 vendors selected for testing.
Cause: The Organization has not adopted a procurement policy resulting in the lack of established internal
controls over the procurement process.
Effect: Without a written procurement policy in accordance with the Uniform Guidance, demonstrating that the
program complies with laws, regulations, and other compliance requirements is difficult.
Questioned Costs: None reported based on assessment of comparative pricing readily available.
Context/Sampling: A nonstatistical sample of 5 vendors out of 15 vendors were selected for testing.
Repeat Finding from Prior Year: No.
Recommendation: We recommend management review 2 CFR 200.318 through 200.327 and adopt a
procurement policy containing all required provisions including provisions to check for suspension and
debarment.
Views of Responsible Officials: Management is in agreement.