Finding Text
MATERIAL WEAKNESSES IN INTERNAL CONTROL OVER COMPLIANCE AND MATERIAL NONCOMPLIANCE ? U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES, PASSED THROUGH MINNESOTA DEPARTMENT OF EDUCATION, COVID 19 ? EPIDEMIOLOGY AND LABORATORY CAPACITY FOR INFECTIOUS DISEASES (ELC) ? FEDERAL ALN 93.323 2022-002 Internal Control Over Compliance and Noncompliance With Federal Procurement Requirements Criteria ? 2 CFR ? 200.320 requires the District to establish and maintain effective internal control over compliance with requirements applicable to federal program expenditures, including procurement requirements applicable to its COVID 19 ? Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) federal program. Condition ? During our audit, we noted that the District did not have sufficient controls in place within its COVID 19 ? Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) federal program to ensure compliance with federal procurement requirements related to methods of procurement. Questioned Costs ? $70,044. Context ? For one of two vendors tested, the District had not awarded a contract based on two or more quotations as required by the Uniform Guidance procurement standards where the value of the goods acquired exceeded the District?s established micro-purchase threshold. This was not a statistically valid sample. Repeat Finding ? This is a current year finding. Cause ? The District attempted to obtain more than one quote, but was unsuccessful and did not retain documentation of its efforts. Effect ? Noncompliance with the procurement requirements could result in the District expending federal funds inappropriately or utilizing vendors that are not eligible to be parties to such transactions, which could be viewed as a violation of the award agreement. Recommendation ? We recommend that the District review its internal control procedures relating to procurement for all federal programs. Internal controls should be in place to ensure compliance with federal procurement procedures, including awarding contracts based on quotations for the purchase of goods or services that exceed the District?s micro-purchase threshold, but not the simplified acquisition threshold. View of Responsible Official and Planned Corrective Actions ? The District agrees with the finding. The District will review its procedures relating to procurement for its federal programs and will ensure that quotations are obtained when required and that adequate documentation is retained. The District has separately issued a Corrective Action Plan related to this finding.