Finding 1235845 (2026-004)

2026-004 Procurement Program Information Federal Organization U.S Department of Health and Human Services Assistance Listing Numbers 93.224 Health Center Program Cluster Award Numbers H80CS00513 Criteria [X] Compliance Finding [] Significant Deficiency [X] Material Weakness Title 2 CFR 200.318 requires that entities receiving federal awards must have and use their documented procurement policies and these policies must be consistent with state and local laws and regulations and the standards identified in §200.317 through 200.327. Condition The Organization did not follow its documented procurement policy. Cause Management did not follow its established procurement policy, and documentation was not maintained evidencing its compliance with the policy, such as obtaining competitive bids and documenting sole-source vendor justifications. Effect The Organization may overpay for goods and services due to selecting vendors without appropriate consideration of the competitive bids and cost analysis. Questioned Costs $39,478 Context In a sample of 40 invoices, we noted six with issues related to the procurement process. Organization did not follow their established procurement policy and did not retain appropriate documentation of competitive bids. Recommendation We recommend that the Organization maintain adequate documentation supporting reports submitted to awarding agencies and update its procurement policy to align with 2 CFR 200.320(c). Views of responsible officials and planned corrective action Management is in agreement with this finding and will take corrective action as outlined on page 34.