Finding 1146993 (2024-001)

Criteria: In accordance with 2 CFR §200.320, federal procurement standards require non- Federal entities to follow documented procedures that promote full and open competition. For small purchases between $10,000 and $250,000, price or rate quotations must be obtained from at least three qualified sources. Purchases exceeding $250,000 must undergo formal procurement procedures such as sealed bidding or competitive proposals. Condition: During our testing of procurement transactions, we identified two vendors with individual purchases exceeding the small purchase threshold of $10,000 for which no documentation of competitive quotes was obtained. Additionally, one vendor exceeded the $250,000 threshold for which a formal competitive procurement process, such as sealed bids or proposals, was not conducted. Cause: While the Organization had a procurement policy aligned with federal requirements, the policy was not effectively enforced throughout the year. Possible effect: The Organization risked overpaying for goods or services and may not have achieved the best value for federal expenditures. Questioned cost: $325,883 – Represents the total expenditures with the three identified vendors during fiscal year 2024. Recommendation: We recommend the Organization enhance its internal controls over procurement by implementing a pre-procurement review process and staff training to ensure consistent compliance with federal procurement thresholds and documentation requirements. Views of responsible officials: Management agrees with the finding and will implement procedures to ensure procurement compliance.