Finding Text
2025-002 Procurement Policy Prior Year Finding Number: N/A Year of Finding Origination: 2025 Type of Finding: Internal Control Over Compliance and Compliance Severity of Deficiency: Significant Deficiency and Other Matter Federal Agency: U.S. Department of Agriculture Program: 10.561 State Administrative Matching Grants for the Supplemental Nutrition Assistance Program Award Number and Year: 252MN101S2514; 2025 Pass-Through Agency: Minnesota Department of Human Services and Minnesota Department of Children, Youth, and Families Criteria: Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish, document, and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Title 2 U.S. Code of Federal Regulations § 200.318 states that the non-federal entity must use its own documented procurement procedures which reflect applicable state, local, and tribal laws and regulations, provided that the procurements conform with applicable federal law and the standards identified in this regulation. Condition: The Health and Human Services has written procurement policies; however, these policies do not include the required components in accordance with Title 2 U.S. Code of Federal Regulations § 200.318. Questioned Costs: None. Context: This issue was discovered during the audit of the major federal program; however, it impacts federal programs entity-wide. Written policies that reflect the specific components of federal regulations improve controls to ensure compliance with federal award requirements. Effect: Written policies and procedures that are not updated to reflect the federal procurement requirements could increase the risk of noncompliance with federal program requirements. Cause: The Health and Human Services modified the procurement policy during the year resulting in language related to several procurement requirements being excluded due to an oversight. Recommendation: We recommend the Health and Human Services include the specific components of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards requirements in its written procurement policies and procedures. View of Responsible Official: Concur