Finding Text
Finding 2021-011 – Compliance and Internal Control Over Procurement (Material Weakness)
Federal Program 14.231 Emergency Solutions Grant
Condition: The Agency’s documented procurement policy did not incorporate the federal procurement requirements as
required under Uniform Guidance. During our audit, we identified procurement transactions that did not follow federally
mandated procedures, including lack of competition, missing cost/price analysis, or inadequate documentation, etc.
Criteria: Non-Federal entities must use their own documented procurement procedures which reflect applicable state and
local laws and regulations, provided that the procurements also conform to applicable federal law and the standards
identified in the Uniform Guidance.
Cause: The Agency did not update its procurement policy to align with the procurement standards under the Uniform
Guidance. Additionally, the existing policy was not operating effectively, as staff did not consistently follow established
procedures or ensure compliance with federal procurement requirements.
Effect: Failure to follow federally compliant procurement procedures increases the risk of unallowable costs being
charged to the federal program and may result in questioned costs or disallowed expenditures.
Recommendation: We recommend that the Agency revise its procurement policy to fully incorporate applicable federal
requirements. In addition, the Agency should evaluate and strengthen internal controls to ensure the policy is effectively
implemented. This includes providing staff training on federal procurement standards and establishing oversight
procedures to ensure consistent compliance.
Management’s Response: See Corrective Action Plan.