Finding 1149443 (2023-002)

Criteria or Specific Requirement OMB’s Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (UG) requires that grant recipients follow procurement procedures for the acquisition of property or services under a federal award. Grantees are required to comply with certain procurement standards as defined in 2 CFR 200.318. These standards include the requirement that the grantee must use its own documented procurement procedures provided that they conform to applicable federal law. In addition, the grantee must maintain records sufficient to detail the history of procurement. Condition and Context During planning procedures for our audit, we concluded that the prior year finding over procurement was not yet remediated. Based on our procedures, there was no supporting documentation retained for those transactions subject to procurement and approvals were given verbally between the requestor and the Executive Director. Cause The Organization did not have adequate controls or policies in place to maintain formal evidence of procurement and to ensure the Organization’s procurement policy was adhered to. Effect or Potential Effect Due to the weakness in internal controls and compliance finding noted above, there is a risk that contracts may be awarded to vendors in a manner that is not consistent with Federal procurement requirements and the Organization’s procurement policy. No questioned costs are reported as vendors subject to procurement policies are below $25,000. Recommendation The Organization should address the weaknesses in internal controls noted above in order to ensure that federal procurements are conducted in accordance with federal requirements and supporting documentation is maintained to support such conclusion. The Organization should ensure that prior to entering into transactions, a review is performed over vendor selection and all required documentation is retained. Views of Responsible Official Management’s corrective action plan is included at the end of this report after the Schedule of Prior Year Findings.