Finding 1239144 (2025-001)

Finding 2025-001 –Procurement , Suspension & Debarment Material Weakness in Internal Control over Compliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. 2 CFR 200.318 maintains that recipients must have and use documented procurement policies and must conform to the procurement standards in sections 200.317 through 200.327. These standards generally require recipients to maintain records sufficient to detail the history of procurement, including the rationale for the procurement method, selection of contract type, contractor selection or rejection, and the basis for the contract price. Condition: Testing of the federal program identified the following: • The Organization failed to document price comparisons including the rationale or circumstances leading up to the selection of the non-competitive sole source procurement. The Organization did follow through with the suspension and debarment check of the contracted vendor. Cause: The Organization lacked adequate documentation of procurement decisions being reached during the initial project funding phase. Effect/Potential Effect: Ineffective controls over this area of compliance could result in a reasonable possibility the Organization would be noncompliant with the compliance requirements outlined above. Questioned Costs: None reported. Context / Sampling: A statistical sample of 1 out of 3 vendors selected for testing.