Finding Text
Criteria or Specific Requirement – 2 CFR Section 200.318 requires recipients of federal grants to maintain and use documented procedures for procurement transactions under a Federal award. Conditions – During 2024, the Organization did not have a written procurement policy. Context – The Organization exceeded the single audit threshold for the first time in 2024, primarily due to a one-time coronavirus grant. We looked up selected vendors on the SAM.gov website and verified they were not suspended or debarred. Cause – Management was not aware of the requirement to have a written procurement policy. Effect or Potential Effect – Not having a written procurement policy could result in inappropriate expenditure of Federal grant proceeds. Recommendation – We recommend that the Organization develop and implement a written procurement policy. Views of Responsible Officials and Planned Corrective Actions – Management acknowledges the finding and appreciates the auditor’s recommendation. The Organization exceeded the Single Audit threshold for the first time in 2024 due to a one-time coronavirus-related grant. As a result, management was not fully aware of the federal procurement documentation requirements applicable to these funds. To address this matter, management has implemented procedures to ensure that procurement documentation supporting compliance with federal regulations is maintained for all federal expenditures. These procedures include staff training on federal grant compliance requirements, enhanced oversight of procurement activities, and the use of standardized documentation and retention practices. Management believes these corrective actions will mitigate the risk of future noncompliance and strengthen overall federal grant administration.