Finding Text
2024-006 Procurement
Program Information
Federal Organization U.S Department of Health and Human Services
Assistance Listing
Numbers
93.224 & 93.527 Health Center Program Cluster
Award Numbers H80CS00513, H8FCS41684, H8GC48547, H8LCS51197
Criteria [X] Compliance Finding [ ] Significant Deficiency [X] Material Weakness
Entities receiving federal awards must have and use their documented procurement
policies. Title 2 CFR 200.320 outlines the acceptable methods of procurement and
establishes the maximum thresholds allowed. Purchases below the simplified
acquisition threshold, but above the micro-purchase threshold, require price or rate
quotations to be obtained from an adequate number of qualified sources.
Noncompetitive procurement can be used only in certain circumstances as allowed for
in 2 CFR 200.320(c).
Condition The Organization’s procurement policy allows the Board to authorize noncompetitive
procurement for certain types expenditures which are outside the circumstances
allowing for noncompetitive bids under 2 CFR 200.320(c). In addition, the
Organization did not follow its documented procurement policy.
Cause The Organization’s procurement policy was not compared with the federal regulations
when it was developed. Management did not follow its established procurement
policy and documentation was not maintained evidencing its compliance with the
policy.
Effect The Organization may overpay for goods and services due to selecting vendors
without appropriate consideration of the competitive bids and cost analysis.
Questioned Costs $514,086 (of which $318,272 was previously reported in findings 2024-004 and
2024-005 above)
Context In a sample of sixty invoices, we noted fourteen with issues related to the
procurement process. Four of these related to the Organization’s procurement policy
being non-compliant with the federal requirements. Two of these were due to the
Organization not following their established procurement policy and eight were due
to the lack of appropriate documentation of the competitive bids.
Recommendation We recommend the Organization maintain documentation supporting reports filed
with awarding agencies.
Views of responsible
officials and planned
corrective action
Management is in agreement with this finding and will take corrective action as
outlined below.