Finding Text
Assistance # 93.323 – Epidemiology and Laboratory Capacity for Infectious Diseases (ELC)
Federal Award # and Year: NU50CK000549, 2024
Name of Federal Agency: U.S. Department of Health and Human Services
Name of Pass-Thru Agency: Kansas Department of Education
Type of Compliance Finding: I - Procurement
Condition: The District did not follow their internal policy for procurement on nine (9) items charged to the grant. The District obtained quotes on all but one (1) item, however, the amount of quotes obtained were not sufficient under the District’s policy.
Criteria: Procurement Methods 2 CFR 200.320(a)(2)(i) - Simplified acquisition procedures. The aggregate dollar amount of the procurement transaction is higher than the micro-purchase threshold but does not exceed the simplified acquisition threshold. If simplified acquisition procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources. Unless specified by the Federal agency, the recipient or subrecipient may exercise judgment in determining what number is adequate. The current policy of the District is that all purchases up to and included $2,999 are considered small or micro and require no quotes, amounts from $3,000 to $10,000 require two (2) quotations on material and/or services, amounts between $10,000 and $19,999 require three (3) quotations, and all items exceeding $20,000 require board approval.
Questioned Costs: N/A
Repeat Finding: No
Context: 9 of the 14 items selected for review did not obtain enough quotes to meet the District’s procurement policy. This is due to the District having documentation of the expenditure and having obtained a minimum of one (1) quote for each. The population the sample was obtained from totaled 36 items. The sample size was determined based upon guidelines provided by the AICPA which is not a statistically valid sample.
Cause: The District's internal controls over procurement compliance were not effectively implemented. Specifically, the procurement policy in place was not consistently followed by staff.
Effect: The District may not have properly compared and evaluated vendors for these purchases.
Recommendations: We recommend the District implement a control to ensure the proper number of quotes obtained on purchases meets the District’s policy.
Views of Responsible Officials: Management agrees with the finding and will implement a more detailed training and supervision process to ensure purchasing requirements are met.