Finding Text
Criteria: Nonfederal entities other than States, including those operating Federal programs as subrecipients of States, must follow the procurement standards set out at 2 CFR Sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable Federal statutes and the procurement requirements identified in 2 CFR Part 200. Nonfederal entities other than States, including those operating Federal programs as subrecipients of States, must follow the suspension and debarment standards set out at 2 CFR Part 180, which implements Executive Orders 12549 and 12689, “Debarment and Suspension,” federal awarding agency regulations in Title 2 of the CFR adopting/implementing the OMB guidance in 2 CFR Part 180; program legislation; and the terms and conditions of the award. Condition: During transactional testing, the following was noted: • 4 out of 8 vendors reviewed did not have evidence of multiple competitive bids being obtained. Additionally, there are no consistent processes in place to check to ensure vendors are not suspended or debarred prior to conducting business. • 4 out of 8 vendors reviewed did not have evidence or processes in place to check to ensure vendors were not suspended or debarred prior to conducting business. None of the 6 vendors were suspended or debarred. Context: The audit findings represent a systematic problem, see condition above. Cause: There were ineffective controls in place during the period over procurement, along with lack of management oversight. Effect: The Clinic is not enacting fair competition in the procurement process nor are they following their policies by making sure bidding support is provided before the appropriate officials sign the Purchase Order. Additionally, the Clinic may be paying vendors that are suspended and debarred which would be an unallowable cost. Questioned Costs: AL#: 93.441 Known: Procurement- $60,729 Repeat Finding: Yes, 2022-007, 2023-004, and 2024-002. Recommendation: We recommend the Clinic conduct training for staff and program managers to review the Clinic’s procurement and suspension and debarment policies and procedures along with federal regulations. Views of Responsible Officials: The Clinic will review the procurement standards set forth at 2 CFR part 200 and will update the procurement and purchasing policies to comply with all required purchasing standards. All vendors will be required to submit and certify a statement regarding debarment and suspension prior to contract award.