Finding Text
Criteria or Specific Requirement
2 CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Award requires compliance with the provisions of procurement and suspension and debarment. The Organization should have internal controls designed to ensure compliance with these provisions.
Condition and Context
We noted the Organization is not in compliance with requirements related to Procurement, Suspension and Debarment. During our testing, we noted the following exceptions:
• SCH The Organization’s procurement policy did not meet the requirements defined by
2 CFR 200.
• The Organization did not retain support to document the procurement methods followed (I.e., sole source, small purchases, sealed bids, proposals, etc.).
Effect
The auditor noted instances of noncompliance. Noncompliance results in possible federal funds provided to ineligible subrecipients and/or vendors.
Questioned Costs
None identified.
Cause
The Organization lacks a uniform Procurement, Suspension & Debarment policy that is in compliance with the Federal regulations and/or the terms and conditions of the Federal award.
Recommendation
• We recommend the Organization review and update its procurement policy to ensure the policy meets the 2 CFR Part 200 Procurement requirements.
• We recommend the Organization retain all documentation and support to show that the procurement policy was followed.
Views of Responsible Officials
The Organization will be reviewing and updating our procurement policy for any missing items not currently noted in our policies or procedures. Gateway and RC Telecom are our sole-source vendors based on the scope and nature of the work and our unique phone system set up. However, no documentation was recorded or kept for this vendor, besides quotes prior to purchases as well as purchase orders per our current purchasing procedure. Our current policy does mention competitive bidding, and the procedure mentions sole-source documentation and what we use for this documentation (currently a bid or quotation), but we need to expand and not just reference the CFR, but at minimum list our thresholds for procurement methods and other required elements. When we meet the bidding threshold, sealed bids are kept in our files. We have not had any sealed bid purchases in fiscal year 2023.