Finding Text
U.S. DEPARTMENT OF AGRICULTURE PASSED THROUGH ARKANSAS DEPARTMENT OF EDUCATION CHILD NUTRITION CLUSTER - AL NUMBERS 10.553, 10.555, AND 10.582 PASS-THROUGH NUMBER 7503 AUDIT PERIOD - YEAR ENDED JUNE 30, 2025 2025-002. Procurement and Suspension and Debarment Criteria or specific requirement: Office of Management and Budget (OMB) 2 CFR part 200.320 and Ark. Code Ann. § 6-21-304 establish methods of procurement to be followed by a non-federal entity when purchasing supplies or services with federal awards. Price or rate quotations must be obtained from an adequate number of qualified sources for purchases greater than $10,000 and up to $25,700. For purchases of supplies and services exceeding $25,700, solicitation of bids or proposals must be utilized. Condition: The District did not retain documentation for price quotations obtained from at least two qualified vendors for Child Nutrition program commodities purchased from one vendor totaling $14,766. School board approval of vendors for Child Nutrition program purchases exceeding $25,700 was not obtained. Additionally, during our review of Child Nutrition program invoices, we identified food purchases that did not agree to the vendor's bid sheet description or price. Cause: Lack of internal controls and management oversight over the procurement of supplies and services. Effect or potential effect: Failure to retain documentation of price quotations and bid approvals increases the overall risk of noncompliance with federal regulations. Questioned costs: $0 Context: An examination of non-payroll expenditures for 11 checks totaling $25,622 from a population of 109 checks totaling $432,754. Of the 11 checks examined, 3 checks were to vendors that required solicitation of quotes or bids. Our sample was not statistically valid. Identification as a repeat finding: No Recommendation: The District should implement proper controls and monitor Child Nutrition program purchases for compliance with applicable procurement requirements. Views of responsible officials: The District will gather two qualified vendors for purchases of $10,000 to $25,000. The District will have Board approval for purchases exceeding $25,700. In addition, the Food Service Director will exercise care to order items on the bid list, but will not be limited to only items on the bid list as new items become available.