Finding Text
2023-002 Internal Control over Compliance and Compliance with Procurement Requirements
See Schedule of Findings and Questioned Costs for chart/table.
Criteria or Specific Requirement: In accordance with §200.318(a), General Procurement Standards, the non-federal entity must use its own documented procurement procedures which reflect applicable State, local, and tribal laws and regulations, provided the procurements conform to applicable federal law and the standards identified in General Procurement Standards. Additionally, §200.318(i) states that the non-federal entity must maintain records sufficient to detail the history of the procurement. These records are required to 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. All procurement transactions must be conducted in a manner providing full and open competition consistent in accordance with §200.319 and must be performed using the appropriate procurement method as outlined in §200.320. In accordance with §200.320(c), Noncompetitive Procurement, there are specific circumstances in
which noncompetitive procurement can be used. Noncompetitive procurement can only be awarded
if one or more of the following circumstances apply: (1) The acquisition of property or services,
the aggregate dollar amount of which does not exceed the micro-purchase threshold (see paragraph
(a)(1) of this section); (2) The item is available only from a single source; (3) The public exigency
or emergency for the requirement will not permit a delay resulting from publicizing a competitive
solicitation; (4) The Federal awarding agency or pass-through entity expressly authorizes a
noncompetitive procurement in response to a written request from the non-Federal entity; or (5)
After solicitation of a number of sources, competition is determined inadequate.
Condition: During the audit, we tested a total of 19 procurements noting the following matters:
o For one procurement sample under award 72038620CA00002, management did not
provide supporting documentation for the procurement transaction. BDO was only
provided a copy of the authorized contract between the procured entity and country
office. Therefore, BDO was unable to conclude that PSI complied with the required
procurement regulations.
o For one procurement sample under award 72061224CA00005, management renewed
a lease agreement in Malawi without performing any procurement procedures to
determine the renewal complied with the requirements of §200.318(a). o For one procurement sample under award 72061224CA00005, BDO noted that
management utilized a single source or sole source justification for the selection
rationale; however, that rationale did not conform to the requirements of limited
competition per §200.320(c).
Questioned Costs: There are no questioned costs.
Context: This is a condition based on testing of PSI’s compliance with specified requirements. The
prevalence of this finding is detailed in the condition section above. The samples were selected
using a non-statistical method.
Cause: PSI personnel did not adhere to PSI’s documented policies and procedures for tracking
procurements, for ensuring complete documentation of the history of the procurement, and for
ensuring proper suspension and debarment validations were performed.
Effect: Failure to perform procurement procedures in accordance with PSI’s documented policies
and Procurement Procedures as outlined in the Uniform Administrative Requirements could result
in the procurement being disallowed.
Repeat Finding: This is not a repeat finding.
Recommendation: We recommend management refine their procurement tracking method by
clarifying established policies and procedures to create more consistency across PSI’s international
office locations.
Views of Responsible Officials: PSI management agrees with the finding and recommendations set
forth within and has developed a corrective action plan to address the instances of noncompliance
identified and lapses in prescribed internal controls.