Finding Text
SIGNIFICANT DEFICIENCY IN INTERNAL CONTROL OVER PROCUREMENT ? STATE AND LOCAL FISCAL RECOVERY FUNDS Condition: During our audit we noted no formal record was retained of a comparison of rates or prices to other emotional health services for a procurement purchase over the threshold of $250,000. Criteria or Specific requirement: The District should have controls in place to ensure compliance with procurement requirements of the State and Local Fiscal Recovery Fund program. This includes approving all purchases and performing a cost or price analysis in connection with every procurement action in excess of the Simplified Acquisition Threshold including contract modifications. The method and degree of analysis is dependent on the facts surrounding the particular procurement situation, but as a starting point, the non-Federal entity must make independent estimates before receiving bids or proposals. Effect: Lack of proper procedures and controls related to the procurement could result in improper contracts being paid with federal funds. The District could also possibly award a contract to a vendor that would charge more than other responsible bidders due to not having performed cost analysis. Cause: The vendor has been utilized by the District for over ten years as a professional service. The District recently charged it to federal funds to supplant some of their other costs. The District was unable to locate the original documents for the contract to determine if they were still under a professional services contract or not, and was not able to come up with any other type of documentation showing the required cost analysis. Questioned Costs: $50,000 Context: One of the five contracts tested did not have supporting documentation following procurement guidelines. Recommendation: We recommend that the District ensures it retains documentation of its controls over all procurements going forward. We also recommend that the district keep documentation of price analysis for procurement items over the micro purchase threshold of $10,000. Prior Year Finding? No Views of responsible officials: There is no disagreement with the audit finding.