Finding Text
Child Nutrition Cluster Procurement and Suspension and Debarment Federal Agency: U.S. Department of Agriculture Federal Program Title: Child Nutrition Cluster Assistance Listing Number: 10.553, 10.555, 10.559 and 10.582 Pass-Through Agency: Wisconsin Department of Public Instruction Pass-Through Entity Identifying Number: 2022-102394-DPI-SB-SEVERE-546, 2022-102394-DPI-NSL-547, 2022-102394-DPI-SK_NSLAE-561, 2022-102394-DPI-FFVP-Oct-376, 2022-102394-DPI-SFSP-561, 2022-102394-DPI-FFVP-July-594 Award period: July 1, 2021 ? June 30, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance. Criteria or Specific Requirement: 2 CFR Section 320.318(i) requires the District to maintain records sufficient to detail the history of procurement. These records will include, but are not necessarily limited to, the following: Rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price. CFR Section 200.214 requires non-federal entities to follow suspension and debarment regulations outlined in 2 CFR part 180. When a nonfederal entity enters into a covered transaction with an entity at a lower tier, the nonfederal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. Condition: The District is part of a consortium composed of multiple school districts that designated one member district to handle procurement, suspension and debarment for all consortium members? food service programs. District policy requires purchases and contracts to be authorized prior to Board approval of monthly expenditures. Questioned Costs: None Context: While there is a consortium lead who is responsible for procurement compliance, the District did not verify this was properly completed, maintain procurement documentation for its files and document approval of contracts as required by District policy. It was also noted that neither of the two procurement transactions tested formally documented the approvals over the contract before purchases were initiated by someone within the District. The District also did not obtain documentation from the consortium lead regarding suspension and debarment status for the prime vendors used prior to approving contracts for the school year. This was not done for the one vendor in our sample however the vendor was determined to not be on the suspended and debarred list. Cause: The District was not aware they needed to document controls ensuring District policy was followed and that it needed to maintain documentation regarding compliance when the consortium handled the process. Effect: Procurement contracts may not be in compliance with the Uniform Guidance. The District could contract with a vendor that has been suspended or debarred from receiving federal funds. Repeat Finding: No Recommendation: We recommend that the District review its Uniform Guidance policies with all staff to ensure procurement requirements are understood and implement controls to ensure compliance. We also recommend the District review and update policies and procedures over review of certain transactions to ensure that all federal grants with covered transactions have vendors reviewed for suspension and debarment status. Views of Reasonable Officials: District does not have any disagreement with the audit finding.