Finding Text
FINDING 2024-005
Information on the federal program:
Subject: Special Education Cluster (IDEA) – Procurement and Suspension and Debarment
Federal Agency: Department of Education
Federal Program: Special Education Grants to States
Assistance Listing Number: 84.027
Federal Award Numbers and Years (or Other Identifying Numbers): H027A210084, H027A220084,
H027A230084
Pass-Through Entity: Indiana Department of Education
Compliance Requirement: Procurement and Suspension and Debarment
Audit Finding: Material Weakness
Criteria: 2 CFR 200.318 states:
“The Non-Federal entity must have and use documented procurement procedures, consistent with State,
local, and tribal laws and regulations and the standards of this section, for the acquisition of property or
services required under a Federal award or subaward. The non-Federal entity's documented procurement
procedures must conform to the procurement standards identified in 200.317 through 200.327.”
and 2 CFR 180.300 states:
"When you enter into a covered transaction with another person at the next lower tier, you must verify that
the person with whom you intend to do business is not excluded or disqualified.
You do this by:
(a) Checking the SAM Exclusions; or
(b) Collecting a certification from that person; or
(c) Adding a clause or condition to the covered transaction with that person."
Condition: An effective internal control system was not in place at the School District to ensure compliance
with requirements related to the Special Education Cluster and Procurement and Suspension and
Debarment compliance requirements.
Cause: The School District's management had not developed a system of internal controls that would have
ensured compliance with the Procurement and Suspension and Debarment compliance requirement.
Effect: The failure to establish an effective internal control system placed the School District at risk of
noncompliance with the grant agreement and the compliance requirements. A lack of segregation of duties
within an internal control system could have also allowed noncompliance with the compliance requirements
and allowed the misuse and mismanagement of federal funds and assets by not having proper oversight,
reviews, and approvals over the activities of the programs.
Questioned Costs: There we no questioned costs identified.
Context: During the audit period, the School District purchased Special Education contracted services from
one specialist with aggregate payments for each fiscal year which were within the small purchases
threshold ($10,000 - $150,000) under Federal and State procurement regulations. The School District did
not solicit multiple quotes for services, document the method and rationale for procurement, and did not
perform a check to confirm the service provider was not suspended or debarred before entering into the
contract and disbursing federal funds.
Identification as a repeat finding, if applicable: No.
Recommendation: We recommend that the School District enter into a written contract with service
providers funded by federal grants. The contract should include a Suspension and Debarment clause or
certification on an annual basis. We also recommend the School District follow their procurement policy for
small purchase thresholds, including documenting procurement rationale and suspension and debarment
checks prior to entering into the covered transaction funded by federal grants.
Views of Responsible Officials and Planned Corrective Actions: Management agrees with the finding
and has prepared a corrective action plan.