Finding Text
Criteria: A non-federal entity is required to have certain written policies and procedure in compliance with Uniform Guidance and must comply with the procurement standards as described in 2 CFR 200.318 through 2 CFR 200.327. Specifically, the non-federal entity must comply with the following:
• The 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 §§ 200.317 through 200.327.
• If the non-Federal entity has a parent, affiliate, or subsidiary organization that is not a State, local government, or Indian tribe, the non-Federal entity must also maintain written standards of conduct covering organizational conflicts of interest. Organizational conflicts of interest means that because of relationships with a parent company, affiliate, or subsidiary organization, the non-Federal entity is unable or appears to be unable to be impartial in conducting a procurement action involving a related organization. Condition: AIRS does not appear to have created written purchasing or procurement policies and procedures as required by 2 CFR 200.318(a). Since AIRS is an affiliate organization of the Ethiopian Community Development Council (ECDC), it appears that the relationship between AIRS and ECDC meets the “affiliate” requirement under 2 CFR 200.318 (c) (2). It does appear that AIRS has created written standards of conduct covering organizational conflicts of interest. Cause: Management has not created or maintained certain written policies and procedures as required under 2 CFR 200.318. Effect: AIRS is not in compliance with certain written policies and procedures as required under 2 CFR 200.318. Questioned Costs: None reported Repeat Finding from Prior Year: Yes Recommendation: In response to Finding 2021-006 during the audit for the year ended September 30, 2021, management has started the process of creating, updating and revising its written policies and procedures. I commend management for their efforts. However, I strongly recommend that management and board complete the written procurement policies and procedures and written standards of conduct covering organizational conflicts of interest prior to start of the 2023 audit. Views of Responsible Officials: Management concurs with this audit finding.