Finding Text
Finding 2024-001 Procurement and Suspension and Debarment (Significant Deficiency)
Information on the Federal Programs: Research and Development Cluster
Criteria or Specific Requirement (Including Statutory, Regulatory, or Other Citation): § 200.318
(i) General procurement standards, states that the non-Federal entity must maintain records sufficient
to detail the history of procurement. These records will include but are not necessarily limited to the
following: rationale for the method of procurement, selection of contract type, contractor selection or
rejection, and the basis for the contract price. Furthermore: §200.320 (f) Methods of procurement to be
followed, states that procurement by noncompetitive proposals is procurement through solicitation of a
proposal from only one source and may be used only when certain requirements have been met.
Additionally, §200.213 Reporting a determination that a non-Federal entity is not qualified for a Federal
award states that non-Federal entities are subject to the non-procurement debarment and suspension
regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. These regulations
restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or
otherwise excluded from or ineligible for participation in Federal assistance programs or activities. The
non-Federal entity must verify that the person with whom you intend to do business is not excluded or
disqualified, by (a) checking SAM Exclusions; (b) collecting a certification from that person; (c) adding
a clause or condition to the covered transaction with that person.
Condition: During our audit, we noted that while FASEB has formal procurement policies under
§200.318(i) and §200.320(f), it did not provide sufficient records detailing the procurement history or
justification for noncompetitive selections in our sample. Additionally, FASEB lacks formal policies on
suspension and debarment, and SAM exclusion screening documentation was not provided for the
sampled contracts and vendors.
Cause: FASEB’s procedures did not provide for the formalization and retention of procurement records
and vendor screenings consistent with the expectations outlined in 2 CFR 200.
Effect or Potential Effect: Purchases of goods and services could be made above the prevailing
market rates if the prescribed procurement procedures are not adhered to. Finally, FASEB could
inadvertently enter into a contractual relationship with an entity that is suspended, debarred or
otherwise included on the US Federal sanction list.
Questioned Costs: N/A.
Context: Our audit work in this area consisted of internal control testwork over a random sample of
expenditures. We consider our samples to be representative of the respective populations, and thus,
are statistically valid samples.
Identification as a Repeat Finding, if Applicable: N/A
Recommendation: We then recommend that FASEB develop and adhere to formal policies (as
applicable) related to § 200.318 (i) General procurement standards, §200.320 (f) Methods of
procurement to be followed, as well as §200.213 Reporting a determination that a non-Federal entity is
not qualified for a Federal award. All procurement actions and SAM exclusion screenings should be
clearly documented in writing and maintained in the vendor or contractor files.