Finding #2025-001 – Significant Deficiency and Other Noncompliance. Applicable federal programs: U. S. Department of Housing and Urban Development, Assistance Listing #14.218, Passed through Harris County, Community Development Block Grants/Entitlement Grants – CDBG – Entitlement/Special Purpose Grants Cluster, Contract #’s: C2023-006G, C2024-006H, and C2020-050G, Contract years: 10/23-09/24, 10/24-09/25, and 03/24-09/24. Assistance Listing #14.218, Passed through City of Houston, Community Development Block Grants/Entitlement Grants – CDBG – Entitlement/Special Purpose Grants Cluster, Contract #: 4600016648, Contract year: 05/25-06/25. U. S. Department of Health and Human Services, Assistance Listing #93.576, Passed through Episcopal Migration Ministries, Refugee and Entrant Assistance Discretionary Grants, Contract #’s: 90RP0117‐01-00, 90RP0117-02-00, 90RP0117-03-00, and 90RP0117-04-00, Contract years: 10/23-09/24 and 10/24-09/25. Applicable state program: Texas Department of Agriculture, Home-Delivered Meal Grant Program, Contract #’s: HDM2024029-070-071 and HDM2025052-053, Contract years: 02/24-01/25 and 02/25-01/26. Condition and context: During our testing of 24 expenditures requiring procurement, we identified one instance of expenditures in Home-Delivered Meal Grant Program greater than the simplified acquisition threshold of $10,000 where simplified acquisition procedures in accordance with Interfaith Ministries’ policy were not followed. Recommendation: Emphasize adherence to established policies and procedures to ensure procurement is performed according to the procurement policy, and that proper procurement documentation is maintained. Planned corrective action: Our organization implemented a robust procurement policy effective July 1, 2018 that complies with the guidelines of 2 CFR 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, Subpart D – Post Federal Award Requirements, Procurement Standards 200.317-326 and the Texas Grants Management Standards. Under the established procurement method for small purchases between $10,000 and $100,000, Interfaith Ministries is required to obtain price or rate quotations from a minimum of three sources. The management team will re-emphasize the established policy and procedures for procurement with Interfaith Ministries staff. Responsible officer: Sheroo Mukhtiar, Chief Executive Officer and Stephanie Alvarez, Chief Financial Officer. Estimated completion date: December 1, 2025