Finding Text
Criteria: Entities may follow informal procurement methods for small purchases less than $15,000 (or $50,000 if self-certified as the micro-purchase threshold). Otherwise, entities must follow formal procurement methods except under very specific circumstances in which the recipient may use a noncompetitive procurement method (2 CFR 200.320). Formal procurement methods are competitive and require public notice. These methods may include sealed bids or proposals. Condition: Management did not document formal procurement methods used for expenditures over $15,000. Cause: Management has previously worked with several universities and research institutions and established a working relationship with them in years not subject federal audit requirements. Management believes these institutions to be fair and reasonable in cost. Effect: Contracts engaged by management did not promote fair competition and may have resulted in excessive costs. Questioned Costs: Federal award purchases beyond the micro-purchase threshold totaled $261,772. Recommendation: We recommend that management follow and document formal procurement methods for all federal award purchases over $15,000, which may include self-certifying a micro-purchase threshold up to $50,000.