Finding Text
Identification of Major Programs Affected: This finding relates to all major programs Criteria: Title 2, U.S. Code of Federal Regulations (CFR), Part 200 establishes procurement requirements applicable to purchases made with Federal awards. 2 CFR § 200.318(i) requires the School to maintain records sufficient to detail the history of procurement transactions. Such records should include, as applicable, the rationale for the method of procurement, selection of the contractor, reasons for contractor selection or rejection, and the basis for the contract price. Additionally, 2 CFR § 200.214 requires compliance with the suspension and debarment requirements contained in 2 CFR Part 180. Under 2 CFR § 180.300, prior to entering into an applicable covered transaction, the School is required to verify that the prospective contractor or vendor is not excluded or disqualified from participation in Federal programs. Verification may be accomplished by reviewing the System for Award Management (SAM.gov), obtaining an appropriate certification from the vendor, or including an applicable clause or condition in the transaction. According to 2 CFR section 200.319, all procurement transactions for acquiring property or services required under a Federal award must be conducted with full and open competition. This ensures fairness and transparency in the procurement process, consistent with the standards outlined in this section and § 200.320. Condition: During our testing of procurement transactions charged to the Federal program, we noted that the School did not maintain sufficient documentation to demonstrate that suspension and debarment verification was performed at the time applicable contracts or covered transactions were entered into. In addition, for certain noncompetitive procurements, the School was unable to provide documentation supporting the sole-source justification or demonstrating that an allowable condition for noncompetitive procurement was met. Cause: The School did not have adequate procedures in place to ensure that suspension and debarment verification and documentation supporting sole-source procurements were completed and retained prior to entering into federally funded contracts. Effect: Noncompliance with procurement requirements under Uniform Guidance and School procurement policy. The lack of adequate procurement documentation increases the risk that purchases made with Federal funds may not comply with Federal procurement requirements or may not be obtained through appropriate competition. Additionally, failure to document suspension and debarment verification increases the risk that the School could enter into a covered transaction with a vendor that is suspended, debarred, or otherwise excluded from participation in Federal programs. Auditor's Recommendations: The School should strengthen its vendor selection procedures and ensure adherence to procurement policies to minimize risks and enhance efficiency. Noncompetitive or sole-source procurements should include written documentation supporting the applicable allowable circumstance under 2 CFR § 200.320. The rationale for the procurement method, vendor selection, and basis for the contract price should be retained in the procurement file. Suspension and debarment status is verified prior to entering into applicable covered transactions using one of the methods permitted under 2 CFR Part 180, and evidence of such verification is retained.