Finding Text
Finding 2023-001 Lack of Internal Control Over Procurement
Federal Agency: U.S. Department of Transportation and Department of the Treasury, respectfully
Federal Programs: Highway Planning and Construction & Coronavirus State and Local Fiscal Recovery Funds, respectfully
ALN: 20.205 and 21.027, respectfully
Award Numbers: DTFH69-13-H-00087, DTFH69-H-00087, Unknown
Award Years: 2023
Type of Finding: Significant deficiency in internal control and noncompliance.
Criteria: In accordance with 2 CFR sections 200.318, a non-Federal entity must have and use documented procurement procedures, consistent with State, local, and tribal laws and regulations and the standards of this section, for the acquisition of property or services required under a Federal award or subaward. The non-Federal entity's documented procurement procedures must conform to the procurement standards identified in sections 200.317 through 200.327.
Condition and Context: Management could not provide adequate procurement documentation for the purchase of a large piece of equipment. During our testing of allowable costs charged to the program we noted two (2) transaction out of six (6) tested that lacked adequate supporting documentation related to procurement. This appears to be an isolated instance of non-compliance.
Cause: Lack of internal controls over procurement.
Effect: Failure to follow compliance requirements could result in loss of federal funding or questioned costs being incurred.
Questioned Costs: None noted. The price for the piece of equipment did not seem unreasonable and was within budgetary requirements.
Repeat Finding: This is not a repeat finding.
Recommendation: We recommend that management establish a procurement policy and ensure that the policy is followed for all large purchases.
Management’s Response: Management concurs with this finding. See corrective action plan.