Finding Text
U.S. Department of Health and Human Services Leading Edge Acceleration Projects (LEAP) in Health Information Technology - 93.345 Award #90AX0034/01-00 Criteria or Specific Requirement – Procurement and Suspension and Debarment In accordance with 2 CFR Section 200.320, a non-federal entity must have and use documented procurement procedures consistent with the standards of Sections 200.317 - 200.320. These standards include a micro-purchase threshold of $10,000 and policies for formal procurement and non-competitive procurement. Additionally, in accordance with 2 CFR Section 180.220, when a non-federal entity enters into a covered transaction with an entity at a lower tier, the non-federal entity must verify that the entity, as defined in 2 CFR Section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. Condition – The Organization's Procurement Policy and Procedure is not in alignment with the requirements of 2 CFR Section 200.320. The policy does not document different procurement methods for various levels of purchases nor does it outline guidance on what are acceptable procurement methods, documentation to be retained, etc. Additionally, formalized documentation supporting the Organization is in compliance with policies and regulations supporting its procurement decisions did not exist. Lastly, there was no suspension and debarment check completed prior to purchases made with federal funds. Cause – The Organization's procurement policies are not in accordance with the Uniform Guidance, nor are there controls in place to ensure policies are followed, and lastly, there are no controls to ensure suspension and debarment checks are performed on vendors receiving federal funds. Effect – Federal funds could be used to make an unauthorized purchase including paying an entity that is suspended or debarred. Questioned Costs – Total questioned costs of $233,700 was identified and represents the value of reimbursements submitted for contracted services under one agreement which the procurement process could not be supported in line with the Uniform Guidance. Context – One purchase of $233,700 out of a total of multiple purchases totaling $239,391 subject to procurement requirements in 2023 was selected for testing. The Organization could not provide documentation supporting their purchase adhered to requirements for formal procurement or noncompetitive procurement outside of a general budget approval from the grantor. Furthermore, a check of the vendor's suspension and debarment status prior to the purchase was not completed. Identification as a Repeat Finding, if applicable – Not applicable Recommendation – Policies and procedures should be modified to ensure that procurement policies are in alignment with federal regulations, support for procurement decisions are maintained and suspension and debarment checks on vendors are performed prior to making purchases with federal funds and are in alignment with the Uniform Guidance requirements. Views of Responsible Official and Planned Corrective Actions – Management agrees with finding. See corrective action plan.