Finding Text
Finding 2023-003
Material weakness in internal control over compliance with procurement procedures meeting the requirements of
2 CFR Part 200.
Federal Agency: United States Department of State
Program Titles: Office of Global Women’s Issues
Assistance Listing Number: 19.801
Pass-Through Entity: N/A
Award Numbers: SLMAQM21CA3275
Award Periods: September 30, 2021 through September 30, 2025
Criteria
Internal controls requirements contained in Title 2 U.S. Code of Federal Regulations Uniform Administrative
Requirements, Cost Principles and Audit Requirements for Federal Awards (the Uniform Guidance) , Subpart D ‐
Post Federal Award Requirements, Section 200.318 through 200.326 Internal Controls, require that a non‐Federal
entity use their own documented procurement procedures, which reflect applicable state and local laws and
regulations, provided that the procurements conform to applicable federal statutes and the procurement
requirement identified in 2 CFR Part 200. A nonfederal entity among others must:
- Use the micro-purchase and small purchase methods only for procurements that meet the applicable
criteria under 2 CFR sections 200.320(a) (1) and (2). Under the micro-purchase method, the
aggregate dollar amount does not exceed $10,000 ($2,000 in the case of acquisition for construction
subject to the Wage Rate Requirements (Davis-Bacon Act)). Small purchase procedures are used for
purchases that exceed the micro-purchase amount but do not exceed the simplified acquisition
threshold ($250,000). Micro-purchases may be awarded without soliciting competitive quotations if
the non-federal entity considers the price to be reasonable (2 CFR section 200.320(a)). If small
purchase procedures are used, price or rate quotations must be obtained from an adequate number
of qualified sources (2 CFR section 200.320(b)).
- For acquisitions exceeding the simplified acquisition threshold, the non-federal entity must use one of
the following procurement methods: the sealed bid method if the acquisition meets the criteria in 2
CFR section 200.320(b); the competitive proposals method under the conditions specified in 2 CFR
section 200.320((b) (2); or the noncompetitive proposals method (i.e., solicit a proposal from only
one source) but only when one or more of four circumstances are met, in accordance with 2 CFR
section 200.320(c)).
Condition/Context
Although the Organization has a procurement policy, and the procedures include the use of a micro purchase
threshold of $3,500, small purchases and simplified acquisition thresholds are not clearly identified. As such, the
policy does not fully incorporate the procurement standards of the Uniform Guidance including sealed bids, cost
or price analysis etc. Cause
The Organization's management was not aware that all components including procurement methods of 2 CFR
section 200.320 are required to be included in the Organization's procurement policy even if the Organization's
procurements would not typically include all procurement methods.
Effect
The Organization did not ensure that its procurement policy follows the procurement standards set out at 2 CFR
Part 200.
Questioned Costs
Not determinable.
Repeat Finding
No.
Recommendation
We recommend the Organization implement measures to ensure that its procurement policy reflect applicable
state and local laws and regulations and conform to applicable federal statutes and requirements in 2 CFR Part
200.
Views of Responsible Individual and Corrective Action Plan
Management agrees with the finding and has provided the accompanying corrective action plan.