Finding Text
Federal Agencies: United State Department of the Treasury
Federal Program Name: Coronavirus State & Local Fiscal Recovery Funds
Assistance Listing Number: 21.027
Federal Award Identification Numbers and Year: None; SLFRP0135-2021; SLFRP135-2021; SLFRP0132132-2023
Award Periods: March 3, 2021 – December 31, 2026; March 3, 2021 – December 31, 2024;
December 14, 2021 – June 30, 2025; January 1, 2023 – December 31, 2023
Type of finding:
• Significant Deficiency in Internal Control over Compliance
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, suspension, and debarment. The City should have internal controls designed to ensure compliance with those provisions.
Condition: During our testing, we noted 1 of the 7 procurement transactions selected for testing as part of statistically valid sample, did not follow the City's procurement policy related to documentation of vendor selection criteria for small purchases. The City applied the requirements of micro-purchases to these transactions.
Questioned costs: None
Context: The City's procurement policy in effect at the beginning of the year under audit identified an outdated micro-purchases threshold. The City adopted in practice the updated micro-purchase threshold identified in 2 CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Award, prior to updating it’s written procurement policy. The procurement policy was updated during the year under audit to align with the thresholds identified in the Federal requirements.
Cause: The City did not review and update the procurement policy in effect prior to the adoption of the updated threshold identified in the most current Uniform Guidance requirements.
Effect: The auditor noted no instances of noncompliance with the provisions of procurement, suspension, and debarment; however, the lack of consistent internal control policies over these compliance requirements provides an opportunity for noncompliance.
Repeat finding: The finding is not a repeat of a finding.
Recommendation: We recommend the City design controls to ensure an adequate review, and update as necessary, of policies occurs when changes in practice or regulation occur.
Views of responsible
officials: There is no disagreement with the audit finding.